1 / 16

4.03 Solve Related Mathematical Problems - PowerPoint PPT Presentation

4.03 Solve Related Mathematical Problems. Opening Cash Fund. The opening cash drawer contains the coins and currency for the day’s business The till is over if there is more money than planned The till is short if there is less money than planned. Completing a Sales Transaction.

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.

PowerPoint Slideshow about '4.03 Solve Related Mathematical Problems' - ramona

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

4.03 Solve Related Mathematical Problems

• The opening cash drawer contains the coins and currency for the day’s business

• The till is over if there is more money than planned

• The till is short if there is less money than planned

• The extension is the result of multiplying the number of units by the cost per unit

• Calculate sales tax and total

2 running shorts at \$32.50 each

3 pair of socks at \$5 each

Tax is 7.5%

2 x \$32.50 = \$65.00

3 x \$ 5.00 = \$15.00

\$65.00 + \$15.00 = \$80.00

\$80.00 x .075 = \$6.00

\$80.00 + \$6.00 = \$86.00

• Cash sales include cash or checks

• Debit cards are bankcards or ATM cards – funds are withdrawn from the customers checking account

Cost of Merchandise Sold

• The amount a retailer actually pays for merchandise

• Cost may be negotiable due to discounts and terms

• Discounts – a reduction in the selling price offered by manufacturers and distributors to their customers to encourage prompt payment and stimulate purchasing

• Allowances – free merchandise given by a manufacturer for large orders as a means of goodwill and to encourage future purchases

• Profit is the amount left from revenue (sales) after the costs of merchandise and expenses have been paid. Expenses include such things as rent, utilities, and salaries.

• Markup is the difference between retail price and cost. In order for a business to be profitable, its markup must be high enough to cover expenses and maintain desired profit.

• Gross profit is a business’ income minus the cost of goods sold.

• Income is the total of all sales for the time period minus any sales returns and allowances

• Cost of goods (merchandise) sold is the actual amount paid to the vendors for the merchandise

• Net profit is what is left after all expenses have been paid by the business

• The most basic pricing formula is the one for calculating retail price when given cost and dollar markup

RETAIL PRICE (RP)= COST(C) + MARKUP (MU)

\$500 = \$300 + \$200

RETAIL PRICE (RP) = COST(C) / 1-MARKUP %

(% markup)

\$500 = \$300 / 1- 40%

• Formulas for cost and markup can easily be derived from the formula, RP=C+ MU.

Cost= RP – MU Markup= RP - C

\$300 = \$500- \$200 \$200 = \$500 - 300

• Markup percentage based on retail. When markup percentage is based on retail, retail price always equals 100 %. To determine markup percentage, divide dollar markup by retail price.

MU% BASED ON RETAIL= DOLLAR MU / RP

40% = \$200 / \$500

• To determine markup percentage based on cost, divide dollar markup by cost.

MU% BASED ON COST = DOLLAR MU / C

66.67% = \$200 / \$300

• Buying errors. Wrong styles, color, sizes, materials, and/or quantities have been purchased.

• Markdowns are used as a tool to stimulate sales, dispose of slow moving/discontinued merchandise, meet competitors’ prices and increase customer traffic.

MARKDOWN (MD) = RETAIL PRICE X MD%

\$25 = \$100 X 25%

• Markdowns are expressed as a percentage of net sales and cannot be calculated until merchandise is sold.

MD%= DOLLAR MD / NET SALES

1.8%= \$10,000 / \$550,000