Expert: Sherry Wallin - 1/31/2010

Question
QUESTION: Hello:

Is calculation (1) the same as calculation (2)?

(1) Tax = Assessed value X (Mills per $1)/$1000

(2) Tax = Assessed value/$1 X Mills/$1000

I believe that Mills/$1000 can be expressed as Mills X $(1/1000).

I thank you for your reply.

ANSWER: Kenneth~
    The word 'per' in mathematics many times means divide or "/". Any number can be divided by 1 without it changing it's value. So in the 2nd one by putting the 1 under assessed value, it hasn't changed a thing. There is an implied 1 in front of Mills also in #2. Also if you were to 'cancel' like units, (here it is dollars), both give you an answer in dollars. Keep in mind that assessed value is a dollar value too. They are both the same calculation and yes your statement is correct also.

Math Prof

---------- FOLLOW-UP ----------

QUESTION: Hello Math Prof.:

I want to thank you for your reply.

This calculation is confusing to me. Tax = Assessed value X (Mills per $1)/$1000

For example, if the assessed value is $200,000 and the tax rate is 20 mills, how do the mills cancel from the calculation? For example, Tax = $200,000 X (20 mills per $1)/$1000 = $?
The answer is in dollars not mills.

(1) Can you indicate how this calculation would provide the correct amount of tax?

(2) I know that mills are changed to dollars. Can you demonstrate how this conversion occurs?

I saw this formula or calculation at the following site. Here is the URL:

http://www.college-cram.com/study/businessmath/presentations/877

I thank you for your follow-up reply.

Answer
Hi Kenneth~
    According to this website mills is the tax per thousand dollars of assessed property value. So for example suppose your property is assessed at $100,000, that is one hundred $1000, so it is 100 mils. So in your example of $200,00 and 20 mils: When you say 20 mils per $1/$1000 that is the same thing as saying 20 mils per $1 per $1000 or 20 mils/$1/$1000 = 20 mils/$$1000 but you are multiplying it by $200,000 so the $ in the $200,000 cancels with one of the $ in $$1000 leaving you with 20(200,00) mils/$1000 = 4,000,000 mils/$1000 = 4,000 mils/$1.

I hope this makes more sense to you.


Math Prof