How discounts are calculated
A discount reduces the original price by a percentage. To find the sale price, you calculate the discount amount (price × discount%) and subtract it from the original price. To go the other way — finding the original price from a sale price — you divide the sale price by (1 minus the discount as a decimal).
Watch out for stacked discounts
Retailers sometimes apply multiple discounts, like "25% off, plus an extra 10% at checkout." These don't simply add up to 35% — each discount applies to the already-reduced price, so the combined effect is slightly less than the sum.
Frequently asked questions
How do I calculate a sale price?
To calculate a sale price, multiply the original price by the discount percentage to find the savings, then subtract that from the original price. For example, a $50 item with a 20% discount saves $10, making the sale price $40.
How do I find the original price from a sale price?
To find the original price, divide the sale price by one minus the discount as a decimal. For example, if an item costs $40 after a 20% discount, the original price is $40 ÷ (1 − 0.20) = $50.
How are stacked discounts calculated?
Stacked discounts are applied sequentially, not added together. For example, a 20% discount followed by a 10% discount results in a combined discount of 28%, not 30%, because the second discount applies to the already-reduced price.