Everyday Math
Basic

Tip Amount

Gratuity based on a bill amount.

Formula

Tip=B×r\text{Tip} = B \times r

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Variables

BBill
rTip rate (decimal)

Example

$40 bill at 18% = $7.20

How it works

This formula finds a tip by taking a percentage of the bill amount. The tip rate must be written as a decimal, so 15% becomes 0.15 and 20% becomes 0.20, because multiplying by a decimal scales the bill to the chosen fraction. In effect, the formula says: tip = part of the bill that you want to leave as extra payment.

When to use it

Use this when you want to calculate a gratuity for restaurant service, a delivery order, or any situation where you decide to tip a percentage of the total bill. It is also useful for checking whether a suggested tip amount is correct.

Worked example, step by step

Bill amount, B = $68 Tip rate, r = 15% = 0.15 Tip = B × r Tip = 68 × 0.15 Tip = 10.20 Final answer: the tip is $10.20

Common mistakes to avoid

  • Using 15 instead of 0.15 for a 15% tip rate
  • Multiplying by the total bill after tax if the tip should be based on the pre-tax amount
  • Forgetting to convert the decimal result into dollars and cents

Did You Know?

A quick 20% tip: move the decimal one place and double it.

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Reviewed & maintained by the FormulaWon editorial teamLast reviewed September 2026