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Interest & Purchases Flashcards

Interest & Purchases Flashcards
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Calculations Involving Markdown
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Calculations Involving Markdown
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Calculations Involving Markup
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Special Event Pricing
Price changes related to a specific event, such as a holiday
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Markdown
Decreasing the price of an item
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Markup
The amount added to the cost of an item so that a profit will be made.
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Calculations Involving Deferred Payments
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Deferred Payment
A payment option that allows the purchaser to wait a set amount of time to pay for the item
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Calculating Fixed Monthly Payments
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Calculating Fixed Monthly Payments
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Fixed Monthly Payments Formula
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Discounts on Invoices

Indicated by #/#, where the first # states the percent discount if the payment is made within the number of days indicated by the second #

Example: 2/10 = 2% discount if paid within 10 days

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n/30

Used on an invoice to tell the purchaser that their payment is due within 30 days

'n' stands for 'net' and can also be used with other numbers (example: n/20: 20 days to pay)

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End of Month (EOM)
Used on an invoice to tell the purchaser that their payment is due on the last day of the current month
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Calculating Percent Change of the Consumer Price Index

1982 index number: 100

Percentage increase = current Consumer Price Index - 100

Example: if the current index is 234.433, the percentage increase is 234.433 - 100 = 134.433%

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Consumer Price Index
An index number that is used to show how the cost of goods has changed since 1982
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32 cards in set

Flashcard Content Overview

These flashcards will help you review the calculations associated with purchases and interest that businesses deal with on a daily basis. You will review different payment options that are found on invoices. These flashcards also show you how to calculate installment payments, including the associated interest. Use these flashcards to learn how to calculate the markup or markdown on a product. These cards also cover calculating the effective annual rate on interest calculations that occur more than once a year, as well as calculating the percentage increase or decrease on the price of a product. Calculations involving promissory notes are also reviewed in these flashcards.

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Consumer Price Index
An index number that is used to show how the cost of goods has changed since 1982
Calculating Percent Change of the Consumer Price Index

1982 index number: 100

Percentage increase = current Consumer Price Index - 100

Example: if the current index is 234.433, the percentage increase is 234.433 - 100 = 134.433%

End of Month (EOM)
Used on an invoice to tell the purchaser that their payment is due on the last day of the current month
n/30

Used on an invoice to tell the purchaser that their payment is due within 30 days

'n' stands for 'net' and can also be used with other numbers (example: n/20: 20 days to pay)

Discounts on Invoices

Indicated by #/#, where the first # states the percent discount if the payment is made within the number of days indicated by the second #

Example: 2/10 = 2% discount if paid within 10 days

Fixed Monthly Payments Formula
Calculating Fixed Monthly Payments
Calculating Fixed Monthly Payments
Deferred Payment
A payment option that allows the purchaser to wait a set amount of time to pay for the item
Calculations Involving Deferred Payments
Markup
The amount added to the cost of an item so that a profit will be made.
Markdown
Decreasing the price of an item
Special Event Pricing
Price changes related to a specific event, such as a holiday
Calculations Involving Markup
Calculations Involving Markdown
Calculations Involving Markdown
Calculations Involving Markdown
Calculations Involving Markdown
Effective Annual Rate
The actual value of an interest rate that accounts for interest calculations done more than one time a year, such as those interests that are calculated monthly or quarterly
Effective Annual Rate Formula
Effective Annual Rate Calculations
Effective Annual Rate Calculations
Effective Annual Rate Calculations
Effective Annual Rate Calculations
Percentage Increase or Decrease
A percentage that shows how a business value, such as costs or sales, has changed from one time period to another
Calculating Percentage Increase or Decrease
Calculating Percentage Increase or Decrease
Calculating Percentage Increase or Decrease
Promissory Note

A written document that describes in detail the terms of a promised payment

Can include payment schedule, interest rates, and additional fees

Calculations Involving Promissory Notes
Calculations Involving Promissory Notes
Dow Jones Industrial Average (DJIA)
This index is used to measure how well U.S. businesses are doing.

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