You take your cost of the chips (Lets say it is 2.50 a bag so $5 for two bags).
20% off means it will be at 80% of the full price so you multiply
5 x 0.8 = 4
Now if you add in the discount of your $1 coupon, you have 4 - 1 = 3 so your final answer would be $3.
(Keep in mind, I was given no cost for the chips so I made one up. This is just to explain the procedure.)