Tip Amount
Gratuity based on a bill amount.
Formula
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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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