Business Mathematics (2nd Quarter) Flashcards
a reduction from list price granted to buyers
trade discount
basic percentage formula
P = BR
(Discount = List Price x Discount Rate)
It could take the form of volume discounts for large purchases, dealer’s or distributor’s discounts or special discounts granted at the discretion of the seller
Trade discounts
Trade discounts could either be a ____ or ____
• single discount
• a series of discounts
Type of trade discount where a seller grant additional discounts other than the discount ordinarily given by him or her
Series of discounts
Formula that is used for computing discounts
Basic percentage formula
P=BR
The biggest loan one can have
Mortgage
loan usually obtained for a hoist, a house and lot, or for machinery or equipment
Mortgage
It is when you use your property as collateral for a loan from a financial institution
Mortgage loan
It is required for most installment purposes. It is usually a certain percent of the purchase price
Down payment
Involves payment of the purchase price for the property and interest on the loan
Property mortgage
Other term for down payment
Buyer’s equity
The term used for the installment payment on the loan
Amortization
The schedule prepared showing the installment payments for the period of payment (called the term of the loan) is called?
Amortization table
Formula for monthly payment
A= iP(1+i)^n / (1+i)^n -1
A= monthly payment
P= loan’s initial amount
i= monthly interest rate
n= total number of payments
A table or chart showing each monthly payment on an amortizing loan indicating how much of each payment goes to interest and how much goes to principal
Amortization schedule
They are generally paid commissions as incentives for increasing a firm’s sales
Salesmen, agents, and brokers
Employees of the firm either paid on a straight commission basis or on salary plus commission basis
Salesmen
Are generally not employees of the firm and paid commissions only
Agents and brokers
They are generally paid overrides on the sales of the people under them
Managers and/or product managers
It applies when a different commission rate is applied if a certain target is reached. It is basically an incentive for a sales agent to reach his or her goal
Override
Formula for gross earnings
Gross earnings= Basic Salary + Commission
These are given to people who have people under them doing the sales, in addition to their basic salary
Overrides
Remember daw: Any allowance given a person is in addition to…?
1.basic salary
2. Commission
3. Override
(See Transportation allowance and representation allowance)
When do companies not give commission based on sales?
When the sales are on installment basis
