Financial Calculations

A:

Business Dictionary lists financial resources as funds that are available to a business for spending. These funds may come in the form of money, liquid securities or credit lines.

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  • How much do teens spend on clothes per year?

    Q: How much do teens spend on clothes per year?

    A: According to Statistic Brain, as of 2014, total spending by American youths aged 13 to 19 years is approximately $258.7 billion annually. According to Business Insider, teens spend 40 percent of their money on clothing. If that's correct, it translates to $103.48 billion spent by teens annually for clothes.
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  • How much does it cost to buy a star?

    Q: How much does it cost to buy a star?

    A: The cost to buy a star ranges from $19.95 to $50 and higher, depending on the specific package chosen. Certain star packages include medallions while others include a commemorative plaque. It is also possible to name the star specifically for a particular person.
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  • What does "net price" mean?

    Q: What does "net price" mean?

    A: The term "net price" refers to the cost of something minus the price of anything that lowers the total dollar value a consumer actually pays, according to U.S. News & World Report. The term is most commonly used by colleges and universities.
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  • What is profit maximization?

    Q: What is profit maximization?

    A: In economics, profit maximization refers to the process by which a business assesses the price and output of goods in order to ensure the greatest profit. During the assessment, businesses will determine the expense of fixed and variable costs during production in order to ascertain financial viability. There are two main ways a business achieves this total revenue-total cost and marginal revenue-marginal cost.
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  • What is the indirect method for preparing a cash flow statement?

    Q: What is the indirect method for preparing a cash flow statement?

    A: The indirect method for preparing a cash flow statement is used to show the uses and sources of cash by a business. It is the preferred method by most companies because the information required to prepare it is fairly easy to assemble from accounts that a company usually maintains. However, the indirect method does not clearly show how cash flows through a business, which is shown in the direct method.
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  • How do I calculate how much I make an hour?

    Q: How do I calculate how much I make an hour?

    A: The hourly rate of pay is calculated by dividing the gross salary for a specific period by the number of hours worked in that same period. Gross salary is the amount earned prior to any deductions.
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  • What is the inventory turnover ratio?

    Q: What is the inventory turnover ratio?

    A: The inventory turnover ratio is a formula that displays how many times inventory is replaced over a period of time by dividing cost of goods sold over average inventory. This ratio is used to identify the efficiency of inventory management within a company.
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  • What is the formula for calculating compound interest?

    Q: What is the formula for calculating compound interest?

    A: One formula for calculating yearly compound interest is M=P(1+i)n. "M" represents the final amount with the principal and interest combined, "P" represents the principal amount, "i" represents the interest rate, and "n" is the number of years invested.
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  • How is a sales commission calculated?

    Q: How is a sales commission calculated?

    A: A sales commission is calculated using the commission structure agreed upon between the owner or manager of a business and a salesperson. This commission structure is sometimes received as a one-time payment. However, it can also be received as a recurring commission over the life of the sales account.
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  • What is the definition of "compound interest"?

    Q: What is the definition of "compound interest"?

    A: Compound interest is a financial term used to describe the process where the interest earned on a principal investment over a set period of time is added to the principal amount. The interest payable for the following periods is recalculated on the sum of the original investment and the previous interest earned. The word "compound" refers to the magnified effect that this method has on an investment's growth potential.
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  • What is the difference between compound and simple interest?

    Q: What is the difference between compound and simple interest?

    A: The difference between simple interest and compound interest is that simple interest builds only on the principal amount, while compound interest builds on both the principal and previously earned interest. Because of this, compound interest always yields greater profits.
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  • What is the formula for total revenue?

    Q: What is the formula for total revenue?

    A: According to AmosWeb, total revenue is calculated by multiplying the price received from the product times the quantity of the product sold at that price. Total revenue is usually depicted as a total revenue curve with it being directly related to marginal revenue and average revenue.
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  • What are capital gains?

    Q: What are capital gains?

    A: Capital gains are the profits an investor makes on certain types of investments. Real estate, precious metals, collectibles, bonds, mutual funds, stocks and options are investments for which a person can earn capital gains, according to About.com.
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  • What is the formula for total profit?

    Q: What is the formula for total profit?

    A: The formula for total profit, or net profit, is total revenue in a given period minus total costs in a given period. If a business generates $250,000 in total revenue in a quarter, but has $215,000 in total costs, its total profit for the period is $35,000.
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  • How do you calculate late fees?

    Q: How do you calculate late fees?

    A: The Bureau of the Fiscal Service, a division of the U.S. Department of the Treasury, provides a monthly compounding interest calculator. This online calculator allows people to automatically determine the amount of monthly compounding interest owed on payments made after the payment due date.
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  • What does a financial analyst do?

    Q: What does a financial analyst do?

    A: Investopedia explains that a financial analyst gathers data and analyzes the financial foundation of a business or industry. The daily tasks of a financial analyst depend on his level of experience. Most junior analysts are responsible for gathering data, while senior analysts are responsible for making connections in the industry. Junior analysts are promoted to senior analysts after a minimum of three years in the industry.
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  • How do you calculate per capita income?

    Q: How do you calculate per capita income?

    A: The U.S. Census Bureau calculates per capita income by dividing a geographic area's total income from the past 12 months by the total population of all ages living in that geographic area. Only income received by people over 15 years old is counted, notes the U.S. Department of Commerce.
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  • What is a marginal revenue function?

    Q: What is a marginal revenue function?

    A: The marginal revenue function in economics refers to the increase in revenue resulting from the sale of one additional unit of output. Marginal revenue is calculated by dividing the change in revenue by the change in output. While the marginal revenue function can remain constant over a specific level of output, it follows the law of diminishing returns. As a result, marginal revenue tapers off as output increases.
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  • What age group spends the most money?

    Q: What age group spends the most money?

    A: According to The Daily Beast, Americans between the ages of 50 and 60 years old spend the most money, about 74 percent more than Americans aged 18 to 25 in 2010. Each group divides its expenditures in a different way.
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  • How do you calculate a percentage of a dollar?

    Q: How do you calculate a percentage of a dollar?

    A: To calculate a percentage of $1.00, treat it as 100 pennies. The percentage sought is equal to the same number in cents. According to Math Is Fun, "percent" is a number per 100, so treating $1.00 as a 100 pennies makes the math simple.
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  • What is an economic continuum?

    Q: What is an economic continuum?

    A: An economic continuum is a method of categorizing parts of the economy, starting with those parts closest to the natural environment and flowing to those parts furthest away from it, according to About.com Geography. More developed countries have longer continua.
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