Profit and Loss Profit : When you sell something for MORE than you bought it. Loss : When you sell something for LESS than you bought it.

Profit and Loss Example 1 St. Merrin FC buy a player for £75,000. 2 years later they sell the same player for £63,500. How much of a loss did St. Merrin make on the player? Loss = 75,000 – 63,500 = 11,500 They made a loss of £11,500

Profit and Loss Example 2 A shopkeeper buys 10 copies of a book at £7.50 each. He sells 6 books at a price of £13.00 each and the remaining 4 books for £5.50 each. a) Calculate the profit made on the first 6 books b) Calculate the loss made on the last 4 books c) Did the shopkeeper make an overall profit or loss? Explain Profit on one book = £13.00 - £7.50 = £5.50 So profit on 6 books = £5.50 x 6 = £33 b) Loss on one book = £7.50 - £5.50 = £2.00 So loss on 4 books = £2.00 x 4 = £8.00 c) Overall Profit = £33.00 - £8.00 = £25.00

Profit and Loss Example 3 A shopkeeper buys crisps for 20p each. He want to make a 40% profit on every pack he sells. How much must he sell them for. 10%  20 ÷ 10 = 2p 40%  2p x 4 = 8p He must sell each packet for 20p + 8p = 28p

Profit and Loss = 50% Example 2 An electronics shop buy TV’s for £300 each and sell them to customers for £450. What percentage profit do they make on each TV. Profit = 450 – 300 = £150 = 50%

Profit and Loss = 37.5% Example 3 A travel shop buy package holidays to Spain for £800. Due to lack of demand they are forced to cut there losses and sell them for £500. What percentage loss do they make on each package. Loss = 800 – 500 = £300 = 37.5%

17.5% VAT VAT means : Value added Tax Why do we pay it ? To pay for NHS, bin collection, School education etc…… What is the current percentage rate of VAT 17.5%

VAT – 17.5% VAT – 17.5% Example 1 10%  1000 ÷ 10 = £100 How much will I pay for the computer including VAT below ? 10%  1000 ÷ 10 = £100 £1000 + VAT 5%  half of 10% = £ 50 2.5%  half of 5% = £ 25 17.5% £175 Total cost is £1000 + £175 = £1175

VAT – 17.5% Example 2 Price of the Plasma TV is shown below is excluding VAT. What is the total price I have to pay. 10%  1300 ÷ 10 = £130 £1300 (excluding VAT) 5%  half of 10% = £ 65 2.5%  half of 5% = £ 32.50 17.5% £227.50 Total cost is £1300 + £227.50 = £1527.50

Gas / Electricity Bills A Gas or electricity bill shows you: The VAT at 5% How many units have been used The total charge The charge for a unit 3567 290 13.5 39 15 3277 3 13 42 28 290

Simply multiply by exchange rate Foreign Currency Converting to another currency Exchange rate : This is the number of euros you get for a £1 Euro € Dollar $ 1.44 1.51 Yen 190 Exchange rate £1= Example : How many euros will I get for £100. Simply multiply by exchange rate £  € 1  1.44 100  100 x 1.44 = 144 €

Foreign Currency Converting to another currency Euro € Dollar $ 1.44 1.51 Yen 190 Exchange rate £1 = Example : How many Dollars and Yens will I get for £50. £  $ 1  1.51 50  50 x 1.51 = $75.50 £  Yen 1  190 50  50 x 190 = 9500 Yen

Simply divide by exchange rate Foreign Currency Converting back to £’s euros to £’s : Simply divide by exchange rate. Euro € Dollar $ 1.44 1.51 Yen 190 Exchange rate £1= Example : How many £’s will I get for 20 € . Simply divide by exchange rate €  £ 1.44  1 20  20 ÷ 1.44 = £13.89

Foreign Currency Converting back to £’s Euro € Dollar $ 1.44 1.50 Yen 190 Exchange rate £1 = Example : A business man returns from American with $450. He converts them back to £’s. How much will he get back ? $  £ 1.50  1 450  450 ÷ 1.50 = £300

Higher Purchase (HP) WHAT IS HIGHER PURCHASE ? When you deal with a shop to pay for goods in instalments It will end up costing you more

£50 deposit and 12 monthly payments of £65 Higher Purchase (HP) FOR SALE £50 deposit and 12 monthly payments of £65 £750 or Example: I can buy this computer for £750 cash I can also buy this computer using higher purchase agreement. How much does it cost to buy this computer using the higher purchase agreement? Instalments = 12 x £65 = £780 Total Cost = Instalments + Deposit = £780 + £50 = £830

Higher Purchase (HP) Del Boy’s Autos Example 2: I bought a car from Del Boy using Higher Purchase. I left a deposit of 10% and agreed to make 18 monthly payments of £105 CASH PRICE £1800 What is the total HP price? Instalments = 18 x £105 = £1890 Deposit = 10% of £1800 = £180 Total Cost = Instalments + Deposit = £1890 + £180 = £2070 How much extra have I paid for the car? £2070 - £1800 = £270

Just working out percentages Simple Interest Just working out percentages Simple Interest I have £400 in the Bank. At the end of each year I receive 7% of £400 in interest. How much interest do I receive after 1 years? How much do I now have?

Just working out percentages Simple Interest Just working out percentages Simple Interest I have £1200 in the Bank. I receive 10% p.a. in interest. How much interest do I receive if I take my money out after 3 months.

Just working out percentages Simple Interest Just working out percentages Simple Interest Stuart invested £4000 in the building Society with an interest rate of 5% p.a. How much does he have after 6 years?

House & Contents & Valuables Insurance Items Charge Building per £1000 £0.73 Contents per £1000 £3.57 Valuables per £1000 £4.75 Example 1 : How much is the House Insurance for a house valued at £40 000. Value Premium (cost of Insurance) £1 000 £0.73 £40 000 (£40000 x £0.73) = £29.20 1000

House & Contents & Valuables Insurance Items Charge Building per £1000 £2.56 Contents per £1000 £3.57 Valuables per £1000 £4.75 Example 2 : Jack wants to insure his house which is worth £80 000. What is Jack’s premium? Value Premium (cost of Insurance) £1 000 £0.73 £80 000 (£80000 x £0.73) = £58.40 1000