What does P245/60R15 mean.

The first number is the width of the tire in millimeters, measured from sidewall to sidewall.
The second number is the aspect ratio. This is a ratio of sidewall height to width.
The last number is the diameter of the wheel in inches.
The P stands for passenger, and the R stands for radial.

Correct. 245 is section width (sidewall), not tread. Many people confuse that with tread width, which vaires from tire to tire due to design.

Here is the equaltion for overall diamter:
OD= RD + (2 X (((SW x (.01 x AR)) / 10) / 2.54))
OD= 15 + (2 X (((245 x (.01 x 60)) / 10) / 2.54))
OD= 15 + (2 X (((245 x .6) / 10) / 2.54))
OD= 15 + (2 X ((147/10) / 2.54))
OD= 15 + (2 X (14.7 / 2.54))
OD= 15 + (2 X 5.78740)
OD= 15 + 11.5748
OD= 26.5748

Or do it the modern way!
http://www.1010tires.com/TireSizeCalculator.asp

Nuts, there goes lunch time. :)