Business Math

STUDENT MATERIALS

A. Textbooks:
   Title: Practical Business Math Procedures, 6th ed.

   Author: Slater
   
   Publisher: Irwin

B. Other Required Materials
    
   Business Math Handbook and Study Guide
    
   Calculator
    
   Other Course Requirements
    
   None

   Student Evaluation (Type of Grading)
    
   Grading policy is established by the individual instructor. A comprehensive final examination
will be given.

Week Topic or Class Activity

1 Review of basic computational skills—writing of whole numbers , rounding, addition,
  subtraction , multiplication, division. Study of fractions and conversion procedures
  coupled with review of basic operations (+, -, x, ÷).


2 Study of fractional-to-decimal and decimal-to-fractional conversion, basic operations,
  and rounding.


3 Study of checking accounts and checkbook—bank statement reconciliation.
 

4 A self-contained introduction and/or review of algebraic manipulations used to solve
  for an unknown. Word problems will figure prominently in the presentation.
 

5 Study of percentage- methods of conversion and application. Portion = Base x Rate
  model examined as a prototype for solution of problems.
 

6 Study of discounts, cash & trade, list pricing, net pricing, credit terms , and partial
  payments. Introduction to markups.
 

7 Continuation of markups as based on either the cost or the selling price. Examination of
  perishables and their effect on pricing.
 

8 Examination of simple interest and related terms (i.e. Exact time, Exact interest,
  ordinary interest). Study cash discounts vs. borrowing.
 

9 Continuation of simple interest-finding unknowns in I = PRT formula. The U.S. Rule and
  Merchant Rule are examined for determining effect of partial payments. Study of
  promissory notes and the discount process. Find future value of an annuity.
  Study compound interest (future value).
 

10 Introduction to installment buying, rule of 78, revolving charge and credit cards.
   Discussion of deferred payments and Annual Percentage Rate.
 

11 Discussion of home ownership - interest rates, down payments, monthly mortgage
   payments, and amortization schedule.
 

12 Introduction to sales tax including computing tax on goods sold involving trade and cash
   discounts. Discussion and calculating excise tax. Discussion of assessed valuation
   and calculating tax rate. Computing property tax .
 

13-14 Continuation of insurance topics. Fire insurance—cancellation table and coinsurance.
      Discussion of auto insurance—compulsory insurance, bodily injury, damage to someone
      else's property, and no-fault.
 

15 Introduction to stocks and bonds. Discussion of stock quotations in the newspaper
   including dividends, yield, P-E ratio. Differentiate between "preferred" and "common"
   stock. Discuss bonds - their quotations and commissions on both stocks and bonds.

OBJECTIVES

1. Identify proper fractions, improper fractions, and mixed numbers.
2. Learn to convert among the forms stated in one.
3. Learn to add fractions (same denominator and different denominators).
4. Find least common denominator by inspection and the prime factor form .
5. Learn to multiply and divide fractions (proper, improper, and mixed).
6. Dissect and solve a word problem.
7. Learn to convert between verbal and decimal forms of number.
8. Learn to round decimals.
9. Learn to complete the conversion of decimal fractions and mixed decimals to fractions.
10. Learn shortcuts in multiplication and division of decimals.

11. Dissect and solve a word problem.
12. Define and state the purpose of signature cards , checks, check stubs, and deposit tickets.
13. Be able to prepare deposit tickets and write checks.
14. Compare and contrast blank, full, and restrictive endorsements.
15. State purpose of bank statement.
16. Be able to prepare a bank reconciliation.
17. Explain “elective funds transfer” and check safe keeping.
18. Learn how a merchant completes a credit card transaction for manual and electronic deposit.
19. Explain mechanical steps needed to solve unknowns from basic equations .
20. Prove solution is correct.

21. Understand the translation steps needed in determining the model of a word problem.
22. Solve and prove word problems.
23. Learn conversions among equivalent forms of decimals, fractions, and percents (i.e., 30% =
    .3=3/10).
24. List and define key elements in the formula Portion = Base x Rate.
25. Solve the percent formula given any two out of three unknowns.
26. Calculate rate of percent increases and decreases.
27. Define and explain need for trade discounts.
28. Calculate amount of trade discount with single discount and with chain discount.
29. Define and use net price equivalent rate.
30. Compare and contrast cash discounts and trade discounts.

31. Explain FOB shipping point and FOB destination.
32. Be familiar with typical discount periods and credit periods.
33. Calculate dollar amounts of markup and percent markup a) on cost, b) on selling price.
34. Solve for selling price given cost and markup is based a) on cost, b) on selling price.
35. Solve for cost when selling price and desired level of markup a) on cost is known, b) on      selling price is known.
36. Convert markup percent on selling price to markup percent on cost.
37. Convert by formula markup percent of cost to markup percent of selling price.
38. Calculate amount of markdown.
39. Set a selling price per unit to cover loss from spoilage.
40. Define principal, rate, time and interest.

41. Calculate simple interests for months and years.
42. Calculate interest by: a) Exact time, exact interest, b) Exact time, ordinary interest.
43. Explain the advantage of borrowing to get a cash discount.
44. Calculate ordinary interest by the 6%, 60-day method or its variations.
45. Calculate an unknown in the simple interest formula: I=PRT.
46. Calculate the interest credit under the U.S. Rule and Merchant’s Rule.
47. Identify parts of a promissory note.
48. Differentiate between interest-bearing notes and noninterest-bearing notes.
49. Calculate bank discount and proceeds for simple discount notes.
50. Contrast the simple discount note and the simple interest note.

51. Calculate true rate of interest for a simple discount note.
52. Calculate maturity value, bank discount, and proceeds on an interest-bearing note for   maturity.
53. Identify and complete the four steps of the discounting process.
54. Compare and contrast compound and simple interest.
55. Calculate compound interest manually and by tables.
56. Compute effective rate.
57. Calculate manually and by tables the value of ordinary annuity.
58. Calculate manually and by tables the value of an annuity rate.
59. For the purchase of a pickup truck, calculate amount financed, total interest deferred payment,
APR (by formula and table), and the monthly payments.
60. Calculate rebate by Rule of 78 as well as final payoff.

61. Calculate finance charges on revolving charge and credit card accounts.
62. Discuss the effect of interest rates and down payments on mortgages one can afford.
63. Identify other items besides principle and interest that a home buyer should consider.
64. Use an amortization chart to compute monthly payment.
65. Calculate total cost of interest.
66. Calculate and identify the interest and principal portion of each monthly payment.
67. Prepare an amortization schedule.
68. Compute sales tax or goods sold involving trade and cash discounts and shipping charges.
69. Explain and calculate excise tax.
70. Define assessed valuation and mills.

71. Calculate tax rate.
72. Compute property tax.
73. Define and calculate life insurance premiums and discuss the advantages and disadvantages of
term, straight life, 20-payment life, and 20-year endorsement.
74. Explain and calculate premium for fire insurance.
75. Explain and calculate cost or premiums and refunds using short rate table.
76. Explain and calculate loss when coinsurance is not met.
77. Explain factors determining cost of auto insurance.
78. Compare and contrast bodily injury, comprehensive and collision.
79. Calculate annual premiums cost of auto insurance for a typical driver.
80. Read and explain stock quotations.

81. Differentiate between round and odd lots.
82. Calculate dividends on preferred (cumulative) and common stock as well as return on investment.
83. Read and explain bond quotations.
84. Compare and contrast bond yields vs. bond premiums and bond discounts.
85. Compute the future value of an ordinary annuity.
86. Compute compound interest.