Interest And Commission Flashcards
is most commonly calculated on short-term loans.
Simple interest
It is calculated only on the original
principal amount and is paid at the end of the loan period
Simple interest
is the fee or rent lenders charge
borrowers for the borrowed moneyβs temporary use.
Interest
It is called as the amount borrowed
Principal
The
_________ is the percentage of the principal that will be charged for a specified period
Interest rate
Symbol of πππππππππ ππππ’ππ‘ ππ π‘βπ ππππ ππ πππ£ππ π‘ππππ‘
P
Symbol of time ππππππ (π‘πππ) πππ‘βπ ππππ ππ πππ£ππ π‘ππππ‘
t
Symbol of π΄πππ’ππ πππ‘π ππ π πππππ πππ‘ππππ π‘
r
Symbol of π΄πππ’ππ‘ ππ πππ‘ππππ π‘ ππππ ππ ππππππ£ππ
I
It is the payment for the borrowed money
Interest
Symbol for πππ‘π’πππ‘π¦ π£πππ’π ππ π‘βπ ππππ ππ πππ£ππ π‘ππππ‘
F
The ______ is the first day of a loan,
loan date
the ______ (or maturity date) is the last day of the loan.
Due date
It is determined using the number of days involved
Time period
uses 30 days in
every month
Approximate time
uses the exact number of days in every specific month,
Actual time
computed 365 days a year as the time factor denominator
Exact interest
is a type of interest wherein the number of days is computed based on 360 days in a year.
Ordinary interest
It is called the Bankerβs Rule
Ordinary Interest using actual time
Ordinary interest using actual time also known as
The bankerβs rule
the
lowest generated interest
Exact interest using approximate time
What are two (2) types of consumer credit for installment purchases
open-ended and closed-ended
loan
is a loan that can be borrowed over and over.
Open ended loans
Credit cards and lines of credit are common types of ____
Open-ended loans
is a
type of loan that cannot be borrowed once theyβve been repaid.
Closed-ended loans
A person or firm representing a company to transact business for another
Agent
Agent also called a
commission merchant or
Broker
The company for which the agent has the power to act is called the
Principal
The fee to an agent (salesperson) is usually a specific rate (percent) of the selling price or
depending on the structure of the underlying commission agreement
Brokerage fee
It is a type of commission wherein the salespersonβs earning, or wage is based on his/her commission
alone.
Straight compensation
It is a commission given to salespersons who do not receive a regular salary and their commission rate
increases as the sales volume increases.
Incremental Commission or Graduated Commission
It is when an employee is being paid a guaranteed salary on total sales made by the employee.
Salary plus Commission
It is when a salesperson earns a commission on his/her sales and commissions from sales of his/her
representatives.
Commission and Override
t is when a salesperson is given a bonus if s/he exceeds his/her sales quota. In cases that the sales do not
exceed the prescribed quota by the company, the salesperson will not receive any bonus.
Commission and Bonus
It is when a salesperson is paid in advance of sales and later deducted from the commission earned. It is
a way for a company to provide its salespeople with at least some income during lean sales periods. The
draw against commission should be lesser than the projected amount of commission.
Draw Against Commission
