Business Math For Dummies

, by Sterling, Mary Jane; Schultz, Benjamin

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ISBN: 9780470233313 | 0470233311
Cover: Paperback
Copyright: 6/30/2008

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The essential desk reference for every business professional or studentThis easy-to-understand resource explains complex mathematical concepts and formulas and offers clear examples of how they relate to real-world business situations. Featuring practical practice problems to help readers hone their skills, it covers such key topics as working with percents to calculate increases and decreases, using basic algebra to solve proportions, and using basic statistics to analyze raw data. Readers will also find solutions for finance and payroll applications, including reading financial statements, calculating wages and commissions, and strategic salary planning.

Introduction	p. 1
About This Book	p. 1
Conventions Used in This Book	p. 2
What You're Not to Read	p. 2
Foolish Assumptions	p. 2
How This Book Is Organized	p. 3
Icons Used in This Book	p. 5
Where to Go from Here	p. 6
Reviewing Basic Math for Business and Real Estate Transactions	p. 7
Starting from the Beginning	p. 9
Fracturing the Myths about Fractions, Decimals, and Percents	p. 10
Capitalizing on Patterns in Formulas	p. 11
Finding the Power in Exponents	p. 12
Doing Some Serious Counting	p. 13
Painting a Pretty Picture	p. 14
Fractions, Decimals, and Percents	p. 15
Changing from Fractions to Decimals	p. 15
Considering the two types of decimals	p. 16
Rounding decimals up or down	p. 17
Converting Decimals to Fractions	p. 20
Ending up with terminating decimals	p. 20
Dealing with repeating decimals	p. 22
Understanding the Relationship between Percents and Decimals	p. 24
Transforming from percents to decimals	p. 25
Moving from decimals to percents	p. 25
Dealing with more than 100%	p. 26
Coming to Grips with Fractions	p. 27
Adding and subtracting fractions	p. 27
Multiplying and dividing fractions	p. 29
Determining Percent Increase and Decrease	p. 31
Working with Percent Increase	p. 31
Computing new totals with increases	p. 32
Determining the percent increase	p. 32
Solving for the original amount	p. 33
Looking into Percent Decrease	p. 34
Finding new totals with decreases	p. 35
Figuring out the percent decrease	p. 35
Restoring the original price from a decreased price	p. 36
Dealing with Proportions and Basic Algebra	p. 37
Setting Up Proportions	p. 38
Solving Proportions for Missing Values	p. 39
Setting up and solving	p. 40
Interpolating when necessary	p. 40
Handling Basic Linear Equations	p. 42
Comparing Values with Variation	p. 44
Getting right to it with direct variation	p. 44
Going the indirect route with indirect variation	p. 45
Taking Intriguing Math to Work	p. 47
Working with Formulas	p. 49
Familiarizing Yourself with a Formula	p. 50
Identifying variables and replacing them correctly	p. 50
Adjusting for differing units	p. 51
Recognizing operations	p. 53
Simplifying and Solving a Formula	p. 54
Operating according to the order of operations	p. 54
Making sure what you have makes sense	p. 57
Computing with Technology	p. 57
Calculators: Holding the answer in the palm of your hand	p. 58
Repeating operations: Simplifying your work with a computer spreadsheet	p. 62
Reading Graphs and Charts	p. 67
Organizing Scattered Information with a Scatter Plot	p. 68
Lining Up Data with Line Graphs	p. 70
Creating a line graph	p. 70
Indicating gaps in graph values	p. 71
Measuring Frequency with Histograms	p. 73
Taking a Piece of a Pie Chart	p. 76
Dividing the circle with degrees and percents	p. 76
Measuring the World around You	p. 79
Converting from Unit to Unit	p. 80
Using the conversion proportion	p. 80
Lining up the linear measures	p. 81
Spreading out with measures of area	p. 82
Adding a third dimension: Volume	p. 86
Making Sense of the Metric System	p. 88
Moving from one metric unit to another	p. 89
Converting from metric to English and vice versa	p. 91
Discovering How to Properly Measure Lumber	p. 92
Measuring Angles by Degrees	p. 94
Breaking down a degree	p. 94
Fitting angles into polygons	p. 95
Analyzing Data and Statistics	p. 97
Organizing Raw Data	p. 97
Creating a frequency distribution	p. 98
Grouping values together in a frequency distribution	p. 99
Finding the Average	p. 102
Adding and dividing to find the mean	p. 103
Locating the middle with the median	p. 104
Understanding how frequency affects the mode	p. 105
Factoring in Standard Deviation	p. 106
Computing the standard deviation	p. 106
Discovering the Math of Finance and Investments	p. 109
Computing Simple and Compound Interest	p. 111
Understanding the Basics of Interest	p. 112
Simply Delightful: Working with Simple Interest	p. 112
Computing simple interest amounts the basic way	p. 113
Stepping it up a notch: Computing it all with one formula	p. 115
Taking time into account with simple interest	p. 116
Surveying some special rules for simple interest	p. 119
Looking into the future with present value	p. 120
Getting to Know Compound Interest	p. 122
Figuring the amount of compound interest you've earned	p. 122
Noting the difference between effective and nominal rates	p. 124
Finding present value when interest is compounding	p. 126
Determining How Variable Changes Affect Money Accumulation	p. 127
Comparing rate increases to increased compounding	p. 127
Comparing rate increases to increases in time	p. 128
Investing in the Future	p. 131
Calculating Investments Made with Lump Sums	p. 132
Reading interest earnings from a table	p. 132
Doubling your money, doubling your fun	p. 136
Going the Annuity Route	p. 139
Preparing your financial future with a sinking fund	p. 139
Determining the payment amount	p. 141
Finding the present value of an annuity	p. 141
Computing the Payout from an Annuity	p. 143
Receiving money from day one	p. 144
Deferring the annuity payment	p. 146
Understanding and Managing Investments	p. 149
Interpreting the Daily Stock Market Quotations	p. 150
Getting to know the stock quotations	p. 150
Computing percent change	p. 153
Using the averages to compute prices	p. 154
Wrangling with the Ratios	p. 157
Examining the stock yield ratio	p. 157
Earning respect for the PE ratio	p. 158
Working with earnings per share	p. 159
Calculating profit ratios	p. 159
Making Use of Your Broker	p. 161
Buying stocks on margin	p. 162
Paying a commission	p. 163
Investing in the public: Buying bonds	p. 164
Using Loans and Credit to Make Purchases	p. 165
Taking Note of Promissory and Discount Notes	p. 166
Facing up to notes that have full face value	p. 166
Discounting the value of a promissory note	p. 167
Borrowing with a Conventional Loan	p. 168
Computing the amount of loan payments	p. 169
Considering time and rate	p. 170
Determining the remaining balance	p. 171
Paying more than required each month	p. 172
Working with Installment Loans	p. 174
Calculating the annual percentage rate	p. 174
Making purchases using an installment plan	p. 175
Putting Math to Use in Banking and Payroll	p. 177
Managing Simple Bank Accounts	p. 179
Doing Business with Banks	p. 179
Exploring the types of business bank accounts available	p. 180
Understanding the importance of account management	p. 181
Balancing Act: How You and the Bank Use Your Account Balance	p. 184
Computing your average daily balance	p. 184
Determining interest using your daily balance	p. 186
Reconciling Your Account	p. 188
Making reconciliation simple	p. 189
Finding the errors	p. 190
Protecting Against Risk with Insurance	p. 193
Surveying the Types of Insurance Available	p. 194
Living It Up with Life Insurance	p. 194
Insuring with a group	p. 195
Protecting your business with endowment insurance	p. 198
Protecting Yourself from Loss by Insuring Your Property	p. 200
Considering coinsurance	p. 200
Examining multiyear contracts	p. 202
Taking advantage of multiple building insurance coverage	p. 203
Deferring premium payments	p. 206
Planning for Success with Budgets	p. 207
Choosing the Right Type of Budget	p. 207
Cashing In on Cash Budgets	p. 208
Looking at an example cash budget	p. 209
Comparing budgeted and actual cash receipts	p. 210
Varying with a Flexible Budget	p. 212
Budgeting Across the Months	p. 214
Using revenue budgets to deal with staggered income	p. 215
Budgeting for ample inventory	p. 216
Measuring Differences with Variance Analysis	p. 218
Computing variance and percent variance	p. 218
Finding a range for variance	p. 220
Dealing with Payroll	p. 223
Pay Up: Calculating Employee Earnings	p. 224
Dividing to determine a timely paycheck	p. 224
Part-timers: Computing the salary of seasonal and temporary workers	p. 226
Determining an hourly wage	p. 226
Taking care of commission payments	p. 228
Subtracting Payroll Deductions	p. 232
Computing federal income tax	p. 232
Determining Social Security contributions	p. 234
Successfully Handling the Math Used in the World of Goods and Services	p. 235
Pricing with Markups and Discounts	p. 237
Examining Markups and Retail Prices	p. 237
Making sense of markups	p. 238
Understanding how markups are a percentage of retail prices	p. 238
Working with the retail price	p. 240
Exploring Discount Pricing	p. 242
Discounting once	p. 243
Successive or multiple discounts	p. 245
Going for a volume discount	p. 247
Calculating Profit, Revenue, and Cost	p. 251
Figuring Profit from Revenue and Cost	p. 252
Understanding how volume affects profit, revenue, and cost	p. 252
Seeing how price is sensitive to demand	p. 253
Sorting out variable and fixed costs	p. 256
What's It Gonna Be? Projecting Cost	p. 260
Dividing up direct and indirect costs	p. 261
Weighing historical and differential cost	p. 263
Determining Break-Even Volume	p. 269
Solving for break-even volume with a formula	p. 269
Working out break-even volume from historical data	p. 270
Accounting for Overhead and Depreciation	p. 273
Keeping an Eye on Overhead Costs	p. 274
Working with order-getting costs	p. 274
Deciding on allocation options	p. 277
Getting the Lowdown on Depreciation	p. 280
The straight-line method	p. 281
The sum-of-the-years' digits method	p. 283
The declining balance method	p. 285
Keeping Track of Inventory	p. 291
Controlling Inventory and Turnover	p. 291
Comparing cost inventory and retail inventory	p. 292
Estimating turnover with an inventory ratio	p. 295
FIFO and LIFO: Giving Order to Inventory	p. 299
Determining Economic Order Quantity	p. 300
Surviving the Math for Business Facilities and Operations	p. 305
Measuring Properties	p. 307
Exploring Area and Perimeter Formulas for Different Figures	p. 308
Rectangles	p. 308
Squares	p. 309
Parallelograms	p. 309
Triangles	p. 310
Trapezoids	p. 311
Regular polygons	p. 311
Circles	p. 312
Ellipses	p. 313
Squaring Off with Square Measurements	p. 314
Figuring total area in various measurements	p. 315
Adjusting for increased area	p. 317
Taking frontage into consideration	p. 320
Calculating acreage	p. 320
Determining Cost per Foot	p. 321
Renting space	p. 322
Estimating building costs	p. 323
Measuring Irregular Spaces	p. 324
Breaking spaces into rectangles	p. 324
Trying out triangles	p. 326
Tracking trapezoids	p. 328
Describing Property with Metes and Bounds	p. 329
Surveyors' directions	p. 329
Measuring a boundary	p. 330
Understanding the Rectangular Survey System	p. 331
Basing measures on meridians	p. 332
Subdividing the 24-mile square	p. 332
Taking Out Mortgages and Property-Related Loans	p. 335
Closing In on Closing Costs	p. 336
Dealing with down payments	p. 337
Paying down using points	p. 337
Considering appraisal fees	p. 338
Prorating property tax	p. 338
Amortizing Loans with Three Different Methods	p. 339
Taking advantage of online calculators	p. 339
Consulting mortgage payment tables	p. 340
Working your brain with an old-fashioned formula	p. 344
Going Off Schedule with Amortized Loans and Mortgages	p. 345
Determining how much of your payment is interest	p. 346
Altering the payments	p. 349
Talking about Borrowing Power	p. 354
Investigating Alternative Loans	p. 355
Taking out a contract for deed	p. 355
Building a construction loan	p. 357
The Part of Tens	p. 359
Ten Tips for Leasing and Managing Rental Property	p. 361
Getting the Full Treatment with a Gross Lease	p. 362
Using a Single Net Lease to Get Your Tenant to Share the Expenses	p. 363
Signing a Double or Triple Net Lease	p. 363
Trying Out a Percentage Lease	p. 364
Stepping It Up with a Step Lease	p. 364
Inserting Expense Provisions into Your Lease	p. 365
Including an Allowance for Improvements in Your Lease	p. 365
Protecting Your Lease with a Security Deposit	p. 366
Adding a Sublease Clause to Your Commercial Lease	p. 366
Deciding Whether You Should Renew, Renegotiate, or Break a Lease	p. 367
Ten Things to Watch Out for When Reading Financial Reports	p. 369
Apologies for Shortfalls	p. 369
Blurring in the Overall Picture	p. 370
Wishy-Washy Descriptions of Trends	p. 370
An Overabundance of Footnotes	p. 370
Listings of the Directors	p. 370
Uncollected Revenues	p. 371
A High Working Capital	p. 371
Long-Term Debt	p. 371
Low Profit Margins	p. 372
Warning Words	p. 372
Index	p. 373
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Business Math For Dummies

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