Math with Business Applications

Exam 3 (Written Portion)

20 points possible

Version 2

Name________________________________________

Show all work to receive credit on each problem. If no work is provided, no credit
can be given. Label the answers.
1. (3 pts) A tablet notebook sells for $384. Find the dollar markup and the cost of the
tablet, if it is marked up 200% on cost.

2. (3 pts) An i-clicker is marked up $48 by a book store. Calculate the cost and the
selling price of the i-clicker, if it is marked up 60% on selling price.

3. On April 2, you purchased 8 cartons of Jelly Belly jelly beans; each carton contains
24 bags of candy. The list price per carton is $24. You also purchased 12 cartons of
Cadbury Crme Eggs; each carton contains 48 eggs individually wrapped for resale.
The list price per carton is $16. You are offered a 20/15 chain discount and cash
terms of 3/10 EOM.
(a) (2 pts) Fill in the purchase invoice below.
Quantity Item Description

Unit List

Unit Net

Subtotal

Amount Due

(b) (1 pt) What is the last day of the discount period?

(c) (1 pt) What is the last day of the credit period?
(d) (2 pt) If you pay your bill on May 5, what is the amount due?

Math with Business Applications

Exam 3 (Written Portion)
20 points possible

Version 2

4. (3 pts) The Cadbury Crme Eggs you purchased in #3 always fly off the shelves; in
the past, you have always sold out of them by Easter. Assuming this is true, find
the selling price for the Cadbury Crme Eggs in your store. In the candy section,
you markup 80% on selling price. Remember to pass along the savings of the cash
discount to your customers.

5. retailer purchases flashlights for $8 apiece, after a 50% trade discount and a 5%
cash discount were applied. The retailer marks up everything in the hardware
section by 125% of cost for operating expenses and another 75% of cost for profit.
(a) (1 pts) What was the unit net price of the flashlight?

(b) (1 pts) What was the unit list price of the flashlight?

(c) (1 pts) What is the retailers target selling price?

(d) (1 pts) Assume that the flashlight is sold during a 25% off sale. What is the sale
price?

(e) (1 pts) Profit is the difference between sales, inventory costs and operating
expenses. Did the retailer make a profit or a loss on the flashlight? Calculate
the profit/loss on the sale price of the flashlight.

Math with Business Applications

Exam 3 (Written Portion)
20 points possible

Version 2

6. Create a sample promissory note: The Example is as follows:

Promissory Note
For value received, XYZ Corporation promises to pay $50,000 to ABC Bank on March 1,
2017 along with interest of 6% interest due at the time of payment. This agreement is
dated November 14, 2016.
Signed XYZ Corporation
On December 15, a payment of $10,000 will be made to ABC Bank.
Interest accrued to date: 50,000(.06)(31/360) = $258.33
Adjusted balance due on Dec 15: 50,000 + 258.33 = $50,258.33
Balance Due after Payment: 50258.33 - 10,000 = $40,258.33
On February 1, 2017, a payment of $15,000 will be made.
Interest accrued to date: 40258.33(.06)(48/360) = $322.07
Adjusted balance due on Feb 1: 40258.33 + 322.07 = $40,580.40
Balance Due after Payment: 40580.40 - 15000 = $25,580.40
On the promissory note's due date, March 1, the final payment is due.
Interest accrued to date: 25,580.40(.06)(28/360) = $119.38
Adjusted balance due on Mar 1: 25580.40 + 119.38 = $25,699.78
Balance due after final payment: 25,699.78 - 25,699.78 = $0
Balance paid in full!

Then, give a payment schedule involving a minimum of three payments: two partial
payments and a final payment. Apply the U.S. Rule.
For full credit, you must:

State the face value, interest rate and maturity date of the short-term (less than one
year) note, along with a proposed partial payment schedule.
Show all of your work for each of the two partial payments, including the calculation
of interest due and adjusted principal balance.
Calculate the note's final payment due on the maturity date.