Decimals and Money

100 cents make a dollar, so one cent is one hundredth of a dollar.

Money is written to two places

$3.50 is 3 whole dollars and 50 hundredths, which is 50 cents.

Why the last zero is written

$3.5 and $3.50 are the same amount, but money is always written to the cent.

A careful reading

$0.05 is five cents. $0.50 is fifty cents. The place matters enormously.

Money is a two-place decimal

$3.47 means 3 dollars, 4 dimes and 7 cents — or simply 3 dollars and 47 hundredths of a dollar. The dollars sit in the ones place and the cents occupy the tenths and hundredths. Money is decimals you have been using since Grade 2.

Adding amounts of money

Line up the decimal points, add as usual, and write the answer with two decimal places. $3.47 + $2.80 = $6.27. Because every amount has exactly two places, alignment is easy — one reason money is a good place to practise decimal addition.

Always two decimal places in the answer

If a calculation gives $6.2, write $6.20. Money is always expressed in whole cents, so the second place is never omitted. An answer of $6.2 is not wrong in value but it is wrong in form, and in a real till it would be ambiguous.

Change is a decimal subtraction

Paying $10 for $6.27 of shopping leaves $10.00 - $6.27 = $3.73. Writing the $10 as $10.00 puts both in hundredths before you begin. Counting up from $6.27 to $10.00 works too and avoids the unbundling entirely.