1. Electronic Filing and Calculating

2. Task 14: Invoices

3. Terminology Purchase order is a written request for a purchase. Purchase order is a written request for a purchase. Vendor is the company from whom the merchandise is purchased. Vendor is the company from whom the merchandise is purchased. Sales invoice is the seller’s bill. Sales invoice is the seller’s bill. Purchase invoice is a document showing the merchandise purchased and the cost. Purchase invoice is a document showing the merchandise purchased and the cost. Extension is the total amount due for each item. Extension is the total amount due for each item. Audited is the calculations verifying accuracy of charges. Audited is the calculations verifying accuracy of charges.

4. Sales Invoices When a vender receives an order requesting merchandise, a sales invoice is prepared. When a vender receives an order requesting merchandise, a sales invoice is prepared. The invoice includes: purchase order number; date merchandise ordered; shipment, freight, and payment terms; quantity and description; and costs. The invoice includes: purchase order number; date merchandise ordered; shipment, freight, and payment terms; quantity and description; and costs. The sales invoice is submitted to accounting department to have bill put on company account. The sales invoice is submitted to accounting department to have bill put on company account.

5. Practice Sales Invoices Clear calculator (CE). Clear calculator (CE). Set Decimal Selector on 2 and rounding on 5/4. Use Grand Total feature. Set Decimal Selector on 2 and rounding on 5/4. Use Grand Total feature. Calculate the extension or amount due for each item. Calculate the extension or amount due for each item. Quantity (24) [x] unit price ($1.96) Did you get $47.04? Quantity (24) [x] unit price ($1.96) Did you get $47.04? Record $47.04 on invoice and answer sheet. Record $47.04 on invoice and answer sheet. Calculate extension for all items and obtain the grand total. Calculate extension for all items and obtain the grand total. Do problems 2 and 3 on own. Do problems 2 and 3 on own.  For No. 3, convert fraction into decimal

6. Freight Costs Freight costs may be paid by seller or by buyer. Freight costs may be paid by seller or by buyer. FOB means Free On Board. FOB means Free On Board. Term FOB Shipping Point means the buyer pays the freight costs. Term FOB Shipping Point means the buyer pays the freight costs. Term FOB Destination means the seller pays the freight costs. The cost of freight is listed on sales invoice and is included in amount due from buyer. Term FOB Destination means the seller pays the freight costs. The cost of freight is listed on sales invoice and is included in amount due from buyer. Determine who pays freight costs in problems 4 and 5. Determine who pays freight costs in problems 4 and 5.

7. Purchase Invoices Buyer verifies that merchandise received is merchandise ordered by comparing original purchase order with purchase invoice. Buyer verifies that merchandise received is merchandise ordered by comparing original purchase order with purchase invoice. Correct merchandise was sent. Correct merchandise was sent. Correct quantities were sent. Correct quantities were sent. Merchandise not damaged. Merchandise not damaged. Submitted to buyer’s accounting department for payment. Submitted to buyer’s accounting department for payment. Accounts payable staff audit for accuracy. Accounts payable staff audit for accuracy.

8. Practice Purchase Invoices Recalculate all extensions and grand total. Recalculate all extensions and grand total. Place checkmark on answer sheet if correct. Place checkmark on answer sheet if correct. If incorrect, draw line through wrong amount and write correct amount on answer sheet. If incorrect, draw line through wrong amount and write correct amount on answer sheet. Approve invoice for payment. Approve invoice for payment. If no errors, write approved followed by your initials. If no errors, write approved followed by your initials. If errors on invoice, write your initials beside each corrected amount on invoice. If errors on invoice, write your initials beside each corrected amount on invoice. Complete problem 6 in class. Complete problem 6 in class. Complete 7 and 8 on own. Complete 7 and 8 on own.

9. Task 16: Discounts

10. Trade Discounts List price is suggested retail (selling) price. List price is suggested retail (selling) price. Trade discount is the amount deducted from list price given to wholesalers and retailers. Trade discount is the amount deducted from list price given to wholesalers and retailers. Net amount is the list price less the trade discount that is price paid by retailers and wholesalers. Net amount is the list price less the trade discount that is price paid by retailers and wholesalers. Trade discounts enable businesses to modify prices for different categories of buyers. Trade discounts enable businesses to modify prices for different categories of buyers. Large purchases receive a discount. Large purchases receive a discount. Price changes between catalogs adjusts prices to buyers. Price changes between catalogs adjusts prices to buyers.

11. Trade Discount Formula Percentage Formula Base (list price) times Rate (trade discount percent) equals Percentage (trade discount amount) B x R = P

12. Single Trade Discounts A single trade discount is a single percentage, such as 20%, off the list price. A single trade discount is a single percentage, such as 20%, off the list price. Clear calculator (CE). Clear calculator (CE). Set Decimal selector on 2 and rounding on 5/4 Set Decimal selector on 2 and rounding on 5/4 Enter list price (1,258.00) and strike [x] key. Enter list price (1,258.00) and strike [x] key. Enter discount rate (20) and strike [%] key. Enter discount rate (20) and strike [%] key. Tap the [-] key to get net amount ($1,006.40). Tap the [-] key to get net amount ($1,006.40). Complete problems 2 through 4 in class. Complete problems 2 through 4 in class. Complete 5 through 10 on own. Complete 5 through 10 on own.

13. Complements It is possible to calculate net amount without calculating discount amount. It is possible to calculate net amount without calculating discount amount. Use the complement or difference between 100% and the discount rate. If discount is 20%, multiply list price by 80%. Use the complement or difference between 100% and the discount rate. If discount is 20%, multiply list price by 80%. Clear calculator (CE) Clear calculator (CE) Set decimal selector on 2 and rounding on 5/4. Set decimal selector on 2 and rounding on 5/4. List price (10,205.50) [x] List price (10,205.50) [x] Percent Complement (100 +22 - =) or 78 [%] Percent Complement (100 +22 - =) or 78 [%] Did you get $7,960.29? Did you get $7,960.29? Complete problems 12 through 14 in class. Complete problems 12 through 14 in class. Complete 14-20 on own. Complete 14-20 on own. B x R = P

14. Series Trade Discounts Retailers often offer a series of trade discounts off the list price. Retailers often offer a series of trade discounts off the list price. Discounts are not added together, but linked together in a series. The discounts are computed in a succession. Discounts are not added together, but linked together in a series. The discounts are computed in a succession. Use complements of discounts in decimal form. (20% or.8) Use complements of discounts in decimal form. (20% or.8)

15. Practice Series Trade Discounts Clear calculator (CE). Clear calculator (CE). Set decimal selector on floating (round final answer to two decimal places). Set decimal selector on floating (round final answer to two decimal places). Enter list price (1,258.00) and strike [x] key. Enter list price (1,258.00) and strike [x] key. Enter complement of first discount rate (.9) and strike [x] key. Enter complement of first discount rate (.9) and strike [x] key. Enter complement of second discount rate (.9) and strike [x] key. Enter complement of second discount rate (.9) and strike [x] key. Enter complement of third discount rate (.95) and strike [=] key. Round. Did you get $968.03? Enter complement of third discount rate (.95) and strike [=] key. Round. Did you get $968.03? Complete problems 22 and 23 in class. Complete problems 22 and 23 in class. Complete problems 24 and 25 on own. Complete problems 24 and 25 on own.

16. Practice Net Amount and Trade Discount The memory feature will allow you to calculate discount amount in addition to net amount. The memory feature will allow you to calculate discount amount in addition to net amount. Enter list price (3,256.00) and strike [M+] key. Enter list price (3,256.00) and strike [M+] key. Strike [x] key Strike [x] key Enter compliment rate (.9) and strike [x] key. Enter compliment rate (.9) and strike [x] key. Enter compliment rate (.9) and strike [=] key. Did you get $2,637.36 for the net amount? Enter compliment rate (.9) and strike [=] key. Did you get $2,637.36 for the net amount? Strike [M-] key. Strike [*M] key. Did you get $618.64 for the trade discount? Strike [M-] key. Strike [*M] key. Did you get $618.64 for the trade discount? Complete problems 27 and 28 in class Complete problems 27 and 28 in class Complete 29 and 30 on own. Complete 29 and 30 on own.

17. Single Discount Equivalents The complements of a series of discounts are multiplied together to obtain a single discount equivalent (a percent equal to two or more series discount percents).

18. Practice Single Discount Equivalents Clear calculator (CE). Clear calculator (CE). Set decimal selector on F Set decimal selector on F Multiply complements of discount rates to calculate single discount equivalent (.9 x.95 x.9). Did you get.7695? Multiply complements of discount rates to calculate single discount equivalent (.9 x.95 x.9). Did you get.7695? Multiply list price by single discount equivalent. Multiply list price by single discount equivalent. Use constant feature (K). Use constant feature (K). Use single discount equivalent from problem 31 to calculate net amount. Use single discount equivalent from problem 31 to calculate net amount. Mentally round amount to 2 decimal places. Mentally round amount to 2 decimal places. Complete 32 through 35 in class. Complete 32 through 35 in class.

19. Discount Equivalent Table A table listing single discount equivalents may be used rather than calculating the equivalents. A table listing single discount equivalents may be used rather than calculating the equivalents. The rates in column headings across top of table represent first discount in series (p. 99). The rates in column headings across top of table represent first discount in series (p. 99). The rates at left of table represent remaining discounts in series. The rates at left of table represent remaining discounts in series. Discount rate: 10, 10, 10 Discount rate: 10, 10, 10 Look at column 10 and look at row 10, 10 Look at column 10 and look at row 10, 10 Did you get.729? Did you get.729? Problem: 6,264.00 [x].729 = $4,566.46 Problem: 6,264.00 [x].729 = $4,566.46 Complete problems 37 through 40 in class. Complete problems 37 through 40 in class.

20. Cash Discounts A cash discount may be deducted from invoice total if prompt or early payment is made. A cash discount may be deducted from invoice total if prompt or early payment is made. Invoice will state payment terms (condition under which cash discount is offered). Invoice will state payment terms (condition under which cash discount is offered). Terms identify time period in which discount can be deducted and final due date of full invoice amount. Terms identify time period in which discount can be deducted and final due date of full invoice amount.

21. Payment Terms 2/10, n/30. A 2% discount if invoice paid within 10 days of date of invoice. If invoice not paid within 10 days, full amount due within 30 days of invoice date. 2/10, n/30. A 2% discount if invoice paid within 10 days of date of invoice. If invoice not paid within 10 days, full amount due within 30 days of invoice date. 3/10, 2/15, n/30. A 3% discount if invoice paid within 10 days of date of invoice. A 2% discount if invoice paid within 15 days of date of invoice. Full amount due within 30 days of invoice date. 3/10, 2/15, n/30. A 3% discount if invoice paid within 10 days of date of invoice. A 2% discount if invoice paid within 15 days of date of invoice. Full amount due within 30 days of invoice date. n/30. No discount offered. Full amount due within 30 days. n/30. No discount offered. Full amount due within 30 days. (continue next slide) If seller offers both trade and cash discounts, trade discount is always deducted first.

22. 5/10, EOM. 5/10, EOM. A 5% discount if invoice paid within 10 days after end of current month. A 5% discount if invoice paid within 10 days after end of current month. Full amount due at end of following month. Full amount due at end of following month. 3/15, ROG. A 3% discount if invoice paid within 15 days after receipt of goods, regardless of invoice date.

23. Practice Due Dates Add number of days in terms to date of invoice to determine discount due date (last day a cash discount can be deducted) and the final due date (day full amount must be paid). Add number of days in terms to date of invoice to determine discount due date (last day a cash discount can be deducted) and the final due date (day full amount must be paid). For invoice dated Jan. 12 & terms 1/10, n/30 For invoice dated Jan. 12 & terms 1/10, n/30 Discount due date. Discount due date. Add date of invoice (12) and length of term (10). Add date of invoice (12) and length of term (10). Answer is Jan. 22 to get 2% discount. Answer is Jan. 22 to get 2% discount. Continue next slide

24. Final Due Date Subtract invoice date (12) from number of days in month of January (31) to determine days left in January. Answer: 19. Subtract invoice date (12) from number of days in month of January (31) to determine days left in January. Answer: 19. Subtract days left in January (19) from length of net term (30) to determine number of days into February. Answer: 11. Subtract days left in January (19) from length of net term (30) to determine number of days into February. Answer: 11. Full amount of invoice is due February 11. Full amount of invoice is due February 11. Complete problems 41-45. (Click on date/time in Control Panel to figure out days.) Complete problems 41-45. (Click on date/time in Control Panel to figure out days.)

25. Cash Discounts Cash discounts are calculated using percentage formula (B x R = P).

26. Practice Cash Discounts Clear calculator (CE). Clear calculator (CE). Set decimal selector on 2. Set decimal selector on 2. Enter invoice total ($1,203.00) and strike [x] key. Enter invoice total ($1,203.00) and strike [x] key. Enter discount rate (2) and strike [%] key. Enter discount rate (2) and strike [%] key. Did you get $24.06? Did you get $24.06? Tap [-] key to get net amount. Tap [-] key to get net amount. Did you get $1,178.94? Did you get $1,178.94? Complete problems 47 and 48 in class. Complete problems 47 and 48 in class. Complete 49 and 50 on own. Complete 49 and 50 on own.

27. Task 17: Interest

28. Terms Line of credit is an amount approved in advance by lender which borrower can access at any time. Line of credit is an amount approved in advance by lender which borrower can access at any time. Interest is the cost of borrowing money. Interest is the cost of borrowing money. Principal is the amount borrowed. Principal is the amount borrowed. Time refers to the length of time of the loan. Time refers to the length of time of the loan. Maturity date is the date the principal must be paid. Maturity date is the date the principal must be paid. Maturity value is principal plus interest amount. Maturity value is principal plus interest amount.

29. Simple Interest Interest is calculated based on principal when the simple interest method is used. Interest is calculated based on principal when the simple interest method is used. Formula: P x R x T = I (principal times rate times time equals interest) Formula: P x R x T = I (principal times rate times time equals interest) Principal is base Principal is base Rate is percent Rate is percent Interest is percentage Interest is percentage Time is length of loan Time is length of loan

30. Time Interest rates are based on time length of one year, so time must be expressed on the basis of a year. Days and months are expressed in fraction form as part of a year. Interest rates are based on time length of one year, so time must be expressed on the basis of a year. Days and months are expressed in fraction form as part of a year. Two methods for expressing time in days: Two methods for expressing time in days: Banker’s method is based on 360 days in year. Banker’s method is based on 360 days in year. Exact method is based on 365 days in year. The exact method is used in this text. Exact method is based on 365 days in year. The exact method is used in this text.

31. Calculating Length of Loan Terms of a loan state principal, interest rate, date loan was made, and due date of maturity value. Terms of a loan state principal, interest rate, date loan was made, and due date of maturity value. Length of loan has to be determined in order to calculate interest amount and maturity value. Length of loan has to be determined in order to calculate interest amount and maturity value. The beginning day of loan is not counted, but the ending day of loan is counted. The beginning day of loan is not counted, but the ending day of loan is counted.

32. Expressing Time 2-year loan: Time is expressed in years. 2-year loan: Time is expressed in years. P ($750) [x] R (7) [%] [x] T (2) [=] I ($105.00) P ($750) [x] R (7) [%] [x] T (2) [=] I ($105.00) 5-month loan: Time is expressed as part of number of months in a year. 5-month loan: Time is expressed as part of number of months in a year. P ($750) [x] R (7) [%] [x] T (5) [÷] 12 = I ($21.88) P ($750) [x] R (7) [%] [x] T (5) [÷] 12 = I ($21.88) 90-day loan: Time is expressed as part of number of days in a year. 90-day loan: Time is expressed as part of number of days in a year. P ($750) [x] R (7) [%] [x] T (90) [÷] 365 [=] I ($12.95) P ($750) [x] R (7) [%] [x] T (90) [÷] 365 [=] I ($12.95)

33. Practice Calculating Length of Loan The problem: A loan agreement on May 29 has a due date of August 27. The problem: A loan agreement on May 29 has a due date of August 27. What is the length of the loan? What is the length of the loan? Subtract 29 from 31 (# of days in May) = 2 Subtract 29 from 31 (# of days in May) = 2 Add the days from May 29 to August 27 Add the days from May 29 to August 27 May =2 days May =2 days June =30 days June =30 days July =31 days July =31 days August =27 days August =27 days Complete problems 1 through 3 in class. Complete problems 1 through 3 in class. Complete 4 through 10 on own. Complete 4 through 10 on own. Length of loan is 90 days.

34. Practice Calculating Simple Interest and Maturity Value Clear calculator (CE). Clear calculator (CE). Set decimal selector on 6 & round to 4 or 6. Set decimal selector on 6 & round to 4 or 6. After keying in principal, strike [M+]. After keying in principal, strike [M+]. Use one continuous operation: Use one continuous operation: P [6,500.] [M+] P [6,500.] [M+] [x] R [9.5] [%] [x] T [232] [÷] [365] [=] I [x] R [9.5] [%] [x] T [232] [÷] [365] [=] I Did you get $392.49? Did you get $392.49? Strike [M+] and then [*M]. Answer: $6,892.49 Strike [M+] and then [*M]. Answer: $6,892.49 Remember maturity value is the date principal must be paid.

35. Calculate Interest and Maturity Value Complete problems 12 through 14 in class. Complete 15 through 20 on own.

36. Unknown Elements When a company is shopping for credit, one of the four elements may be unknown. When a company is shopping for credit, one of the four elements may be unknown. The missing element can be easily calculated by converting the basic formula. The missing element can be easily calculated by converting the basic formula. Interest = Principal x Rate x Time Interest = Principal x Rate x Time

37. Calculating the Principal Convert the simple interest formula as follows: Convert the simple interest formula as follows: Principal = Interest amount ÷/over Rate x Time Principal = Interest amount ÷/over Rate x Time Clear calculator (CE). Clear calculator (CE). Set decimal selector on 4 and rounding on 5/4. Set decimal selector on 4 and rounding on 5/4. Calculate the denominator by multiplying the days by rate and dividing by days in yr. Calculate the denominator by multiplying the days by rate and dividing by days in yr. 76 [x] 8.25 [%] [÷] 365 [=]. Did you get.0172? 76 [x] 8.25 [%] [÷] 365 [=]. Did you get.0172? Divide interest amount by denominator to get principal. Divide interest amount by denominator to get principal. 267.14 [÷].0172 [=]. Did you get $15,531.50? 267.14 [÷].0172 [=]. Did you get $15,531.50? Complete problems 22 through 24 in class. Complete problems 22 through 24 in class.

38. Calculating the Rate Convert the simple interest formula Convert the simple interest formula Rate = Interest amount/ Principal x Time Rate = Interest amount/ Principal x Time Clear calculator (CE). Clear calculator (CE). Set decimal selector on 4 and rounding on 5/4. Set decimal selector on 4 and rounding on 5/4. Calculate denominator by multiplying principal by the days (time) and dividing days in a year. Calculate denominator by multiplying principal by the days (time) and dividing days in a year. 7,814. [x] 274 [÷] 365 [=]. Did you get $5,865.85? Divide interest amount by denominator to get the rate. Divide interest amount by denominator to get the rate. 460.40 [÷] 5,865.85 [=]. Mentally round to two decimal places. Did you get.0785 or 7.85%? Complete 32 through 34 in class.

39. Calculating the Time Convert to simple interest formula. Convert to simple interest formula. Time = Interest amount / (Principal x Rate) x 365 Time = Interest amount / (Principal x Rate) x 365 Clear calculator (CE). Clear calculator (CE). Set decimal selector on 4 and rounding on 5/4. Set decimal selector on 4 and rounding on 5/4. Calculate denominator by multiplying principal by rate. Calculate denominator by multiplying principal by rate. Did you get $2,749.00? 32,152. [x] 8.55 [%]. Did you get $2,749.00? Divide interest amount by denominator and multiply by days of year to get time. ( Mentally round to whole number.) Divide interest amount by denominator and multiply by days of year to get time. ( Mentally round to whole number.) Did you get 38 days? 287.05 [÷] 2,749. [x] 365 [=]. Did you get 38 days? Complete 42 through 44 in class. Complete 42 through 44 in class. Complete 45-50 on own. Complete 45-50 on own.

40. Discounting When a company has a poor credit history or does not have an established credit history, they are considered to be a poor risk and it is rated at a high risk level. When a company has a poor credit history or does not have an established credit history, they are considered to be a poor risk and it is rated at a high risk level. The lender retains the interest amount at time the loan is made, and the company receives the amount borrowed minus the interest or discount amount. Do not do this section.

41. Compound Interest Companies generally use compound interest to calculate interest earned on investments.

42. Compound Interest Interest earned on the principal is added to principal amount before additional interest is calculated. Interest earned on the principal is added to principal amount before additional interest is calculated. Compound means principal and interest are added together to become the new amount for calculating interest. Compound means principal and interest are added together to become the new amount for calculating interest. When interest is compounded, investment earns more interest than if simple interest is calculated for the same time period. When interest is compounded, investment earns more interest than if simple interest is calculated for the same time period.

43. Compounding Lump Sum Deposits When the total amount to be placed in an investment account is deposited at the beginning of the life of the account.

44. Compounding Lump Sum Deposits Problem: $4,500 is deposited in an investment account at beginning of year. Account earns 8% interest per year. What amount of interest will be earned at end of three years? Problem: $4,500 is deposited in an investment account at beginning of year. Account earns 8% interest per year. What amount of interest will be earned at end of three years? First year:$4,500 (P) x 8% (R) x 1 (yr.) = 360.00 First year:$4,500 (P) x 8% (R) x 1 (yr.) = 360.00 $4,500.00 [+] 360.00 [=] $4,860.00 Second year:$4,860 ( new P) x 8% x 1 = 388.80 Second year:$4,860 ( new P) x 8% x 1 = 388.80 $4,860.00 [+] $388.80 [=] $5,248.80 Third year: $5,248.80 (new P) x 8% x 1 = 419.90 Third year: $5,248.80 (new P) x 8% x 1 = 419.90 $5,248.80 [+] $ 419.90 [=] $5,668.70 $5,248.80 [+] $ 419.90 [=] $5,668.70 Interest earned--$ 5,668.70 [-] $4,500.00 [=] $1,168.70 Interest earned--$ 5,668.70 [-] $4,500.00 [=] $1,168.70 Use [+] key after calculating interest to take advantage of add-on feature.

45. Compound vs. Simple Interest Simple interest method: Simple interest method: $4,500.00 (P) x 8% (R) x 3 (T) = $1,080.00 ( I ) $4,500.00 (P) x 8% (R) x 3 (T) = $1,080.00 ( I ) Compare: Compare: Interest earned by compound method = $1,168.70 Interest earned by compound method = $1,168.70 Interest earned by simple method =$1,080.00 Interest earned by simple method =$1,080.00 Interest increase due to compounding =$ 88.70 Interest increase due to compounding =$ 88.70 Complete problem 72 in class. Complete problem 72 in class. Complete 73-80 on own. Complete 73-80 on own.

46. Compounding Periodic Deposits Deposits made at specified time periods, such as quarterly or yearly, are referred to as annuity due deposits. Do not do problems 81 through 87.

47. Task 18: Pricing

48. Terms Profit is the net income. Profit is the net income. Operating expenses include utilities, supplies, and payroll. Operating expenses include utilities, supplies, and payroll. Markup amount is the amount added to the cost of the merchandise or service and is a percentage based on selling price or cost of the merchandise or service. Markup amount is the amount added to the cost of the merchandise or service and is a percentage based on selling price or cost of the merchandise or service.

49. Markup The selling price of goods and services determines how much profit a company will make. The selling price of goods and services determines how much profit a company will make. Price charged to customers must cover both cost of merchandise or service to company and operating expenses. Price charged to customers must cover both cost of merchandise or service to company and operating expenses. Retailers generally use selling price as base for markup while manufacturers use cost as the base. Retailers generally use selling price as base for markup while manufacturers use cost as the base.

50. Markup Based on Cost Cost is 100% or the base. Formula used: Cost is 100% or the base. Formula used: Markup Amount (percentage):MU = C x R Markup Amount (percentage):MU = C x R Markup % (Rate):R = MU ÷ C Markup % (Rate):R = MU ÷ C Cost (Base):C = MU ÷ R Cost (Base):C = MU ÷ R Clear calculator (CE) Clear calculator (CE) Use add-on feature Use add-on feature Set decimal selector on 2 and rounding on 5/4. Set decimal selector on 2 and rounding on 5/4. Multiply cost by markup percent to get markup amt. $15.34 [x] 33 [%] Did you get $5.06? Multiply cost by markup percent to get markup amt. $15.34 [x] 33 [%] Did you get $5.06? Add cost and markup amount to get selling price. [+] Did you get $20.40? Add cost and markup amount to get selling price. [+] Did you get $20.40?

51. Practice Calculating Markup Based on Cost Complete problems 2-4 in class. Complete 5-15 on own.

52. Markup Based on Selling Price Formula used: Formula used: Markup Amount (Percentage):MU = SP x R Markup Amount (Percentage):MU = SP x R Markup % (Rate):R = MU ÷ SP Markup % (Rate):R = MU ÷ SP Selling Price (Base):SP = MU ÷ R Selling Price (Base):SP = MU ÷ R Clear calculator (CE). Clear calculator (CE). Set decimal selector on 2 and rounding on 5/4. Set decimal selector on 2 and rounding on 5/4. Use add-on feature. Use add-on feature. Multiply selling price by markup percent to get markup amt. $265.91 [x] 42 [%] Did you get $111.68? Multiply selling price by markup percent to get markup amt. $265.91 [x] 42 [%] Did you get $111.68? Subtract markup amount from selling price to get cost. tap [-] Did you get $154.23? Subtract markup amount from selling price to get cost. tap [-] Did you get $154.23?

53. Practice Markup Based on Selling Price Complete problems 17-18 in class. Complete 19-20 on own. If you were calculating just for selling price, enter cost [x] percentage markup amount and strike [MU] key. $154 [x] 36 [MU]. Did you get $209.44?

54. Markdown Markdown is the price reduction from the original selling price. Markdown is the price reduction from the original selling price. The purpose is to attract customers in order to reduce inventory at end of year. The purpose is to attract customers in order to reduce inventory at end of year. May be stated as a dollar amount or as a rate of markdown from selling price. May be stated as a dollar amount or as a rate of markdown from selling price. Formula: Formula: Markdown amount (Percentage)MD = SP x R Markdown amount (Percentage)MD = SP x R Markdown % (Rate)R = MD ÷ SP Markdown % (Rate)R = MD ÷ SP Selling Price (Base)SP = MD ÷ R Selling Price (Base)SP = MD ÷ R

55. Practice Markdown Clear calculator (CE). Clear calculator (CE). Set Decimal Selector on 2 and rounding on 5/4. Set Decimal Selector on 2 and rounding on 5/4. Multiply selling price by markdown percent to get markdown amount. Multiply selling price by markdown percent to get markdown amount. $148.79 [x] 22 [%] Did you get $36.35? $148.79 [x] 22 [%] Did you get $36.35? Tap [-] key to get reduced selling price. Did you get $84.82? Tap [-] key to get reduced selling price. Did you get $84.82? Complete problems 27 and 28 in class. Complete problems 27 and 28 in class. Complete 29-30 on own. Complete 29-30 on own.

56. Practice Markdown (con’t) To calculate only reduced selling price, multiply selling price by complement of markdown percent. To calculate only reduced selling price, multiply selling price by complement of markdown percent. A desk sells for $567 is marked down 33%. What is the reduced selling price? A desk sells for $567 is marked down 33%. What is the reduced selling price? 567.00 [x] 67 [%] Did you get $379.89? 567.00 [x] 67 [%] Did you get $379.89? Complete problem 32 in class. Complete problem 32 in class. Complete 33-35 on own. Complete 33-35 on own.