Working Effectively in Accounts and Finance Calculations & Communication

Aims of the Session Rounding Fractions Percentages Averages Ratios Formulas VAT Margin & Mark up (level 3)

M-athletics

Whole Figure Rounding What is rounding? What would 12.85582645735294 be rounded to a whole figure? 12.85582645735294 What would the following be rounded to the nearest whole number? 9434.76875897 452.234787 5494.1576093723 896.026748 4532.4393475829345 345.512 45.59346 785.0014556 54634346.455787345 73.34568 Makes large unwieldy figures more manageable, by altering them. 13 Look at the figure AFTER the one you need to round to, so in this case 8, if this is 5 or higher round up to the next whole number, 4 or lower would be 12.

Decimal Point Rounding Similar to whole figure, look to the figure after you’ve been asked to round to. For example: 12.85582645735294 to 2 decimal places. 12.855 = 12.86 Amount of places to round to Amount of places to round to 3 9434.76875897 5 452.234787 4 5494.1576093723 1 896.026748 9 4532.4393475829345 Whole number 345.512 45.59346 2 785.0014556 7 54634346.455787345 73.34568

Answers 3 9434.769 5 452.23479 4 5494.1576 1 896.0 9 4532.439347583 Whole number 346 45.593 2 785.00 7 54634346.4557873 73.346

Fractions What is a fraction? Expressed as: So a slice of cake is? Improper fractions. 1 2 1 10 A numerical quantity that is not a whole number, Expressed as one number over another, the bottom number will be total of the parts of the whole and the number on the top the amount that’s relevant. Improper fractions or top heavy ones, to convert them into proper ones divide the numerator by the denominator, write down the amount left over and put this over 10 ie...

Percentages Similar to fractions. To find a percentage from a fraction use your calculator to divide the top number by the bottom multiply by 100 4/5 = 0.8 x 100 = 80% As an increase, you are told that the bus fare (£3.60) is going up by 5%. Divide 3.50 by 100 to find out 1% then multiply by 5 and add it on to the original amount. Or multiply by 1.05 – 1 for the initial amount and 0.05 for the increase. Percentages of figures… A proportion or share in relation to the whole. Both will give you the same answer 18p or £3.78

Percentages Monthly Usage Monthly Usage % March 35,375 33.66% April 36,834 35.04% May 32,901 31.30% 105,110 Add up the usage figures, divide the monthly figure by the total.

Test Your Knowledge May’s figures are 5% higher than March’s. Monthly Usage Monthly Usage % March 35,880 April May May’s figures are 5% higher than March’s. April’s figures are 15% lower than May’s. Round the month calculations to nearest whole number. Calculate the monthly totals as a percentage of the total usage for the quarter, to two decimal places.

Test Your Knowledge Answers Monthly Usage Monthly Usage % March 35,880 33.98% April 32,023 30.33% May 37,674 35.68% 105, 577

Percentages Differences Work out the difference between the 2 figures and then divide this by the original figure, multiply by 100: For example: Target sales are 10,000 actual sales are 10,900 what is the percentage difference? 10,900 – 10,000 = 900 10,900 - 10,000 = 900 0.09 X 100 = 9%

Test Your Knowledge Negative figures ( ) Target Production Actual Production Actual production in the excess of the target % Dolls’ Heads 4,500 4,095 Dolls’ Hair 500kg 750 Dolls’ Legs 9000 10350 Negative figures ( )

Test Your Knowledge Negative figures ( ) Target Production Actual Production Actual production in the excess of the target % Dolls’ Heads 4,500 4,095 405 /4500 x 100 = (9%) Dolls’ Hair 500kg 750 250/500 x 100 = 50% Dolls’ Legs 9000 10350 1350/9000 x 1000 = 15% Negative figures ( )

Averages Mean Mode Median The range (not a big shop) Mean is adding up the numbers and dividing it by the amount. Mode is the most frequently appearing number Median the number in the middle Put the numbers in order then work out, the median with even numbers, add the 2 middle ones together and then divide by 2. The range is the difference between the lowest and the highest number.

Test Your Knowledge! Find the mean, mode, median and range of these figures: Round answers to nearest whole number 9, 3, 3, 44, 17 , 17, 44, 15, 15, 15, 27, 40, 8, 9 9, 3, 44, 17, 15, 10, 4, 44, 17, 17, 16, 10, 9, 59, 17 60, 9, 3, 6, 2, 90, 3, 61, 90, 31, 45, 90, 4, 30 43, 58, 39, 20, 43, 61, 83, 92, 73, 13, 43, 101 76, 43, 21, 56, 24, 42, 73, 26, 42, 67, 1, 56, 42

Ratios Numbers expressed in relation to each other. For example when making pastry you mix 2 parts flour to 1 part fat, the ratio is expressed flour to fat 2:1. Similar to fractions as they can be simplified by finding a common factor.

Test Your Knowledge A newspaper has 12 pages of sport and 8 of TV, what is the ratio of sport to TV in its simplest form? A class has 15 girls and 12 boys, what is the ration of girls to boys in its simplest form? Jamie has £75 and Cersei has £120, what is the ration of Jamie’s money to Cersei’s in its simplest form. 3:2 5:4 5:8

Re-jigging Formula You will be asked to re-jig formula For example: assets - liabilities = capital To find out assets you will add liabilities to both sides of the equation. assets - liabilities + liabilities = capital + liabilities better expressed as assets = capital + liabilities You’ve already done this

Cost of Sales (Level 3) Cost of sales = opening stock + purchases - closing stock. Allocate each item a number: Check by doing the simple maths first. Opening stock = £19,402 Closing stock = £16,497 Cost of sales = £42,864 What's the value of the purchases through out the year? 5 = 3 + 4 - 2 Cost of Sales Opening stock Purchases Closing Stock Sarah’s idiots guide, remember the formula in one way: Allocate each part a number that you know adds up, that way you can do a sanity check that you’re correctly adding and taking away the correct number.

Answer 5 = 3 + 4 - 2 Cost of Sales Opening stock Purchases Closing Stock 42,864 19,402 ? 16,497 4 = 5 - 3 + 2 Purchases Cost of sales Opening stock Closing Stock 39,959 42,864 19,402 16,497

VAT AAT figures are either VAT exclusive or inclusive. Exclusive (net) add 20% on. Goods exclusive of VAT worth £30 what is the VAT? Good inclusive of VAT are 120% of the net price. 30 x 20% = £6 £30 + £6 = £36 36 ÷ 120 = 0.3 0.3 x 20 = £6 36 – 6 = 30 Don’t forget the inclusive figures are 120% of the net, which you are trying to work out.

Lesson Recap Will be asked simple calculation in the WEAF exam.

Oombrella & Other Exercises