# Financial Calculations

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Gross Profit
Selling Price - Cost Price
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Gross Profit Percentage
Gross Profit / Cost Price x100
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Multipliers
The Multiplier is the amount added to find the answer. Example: £80 is 100% so what would 120% be? 80 x 120/100 = £96 = 80 x 1.20
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Ratios and Proportion
http://getrevising.co.uk/resources/ratio_and_proportion
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Percentage Change
New Amount - Old Amount / Old Amount x 100
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Percentage Change
Sale Price - Cost price / Cost price x 100
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AER - Annual Equivalent Rate
Interest on savings / Amount invested x 100
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Total Amount payable
The original loan plus the interest paid
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Interest
Interest = Total Payment - Original
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Mortgage Calculations
How much you borrow depends on your pre-tax income
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One Person Mortgage
The usual rule is 3.25 x annual income
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Two People Mortgage
The greater of these options: 3.25 x higher annual income + 1 x lower annual income OR 2.5 x combined annual income
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Loan to Value
Percentage of loan that you would be given - the rest would have to be made up as a deposit
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Salary Calculations
Income tax based on 2013/2014 paper
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Basic Rate
20% Basic rate on the first £32245 of taxable income
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Higher Rate
40% Higher rate tax on taxable income between £32245 and £150,000
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45% additional rate on incomes over £150,000
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Personal tax allowance
Standard personal tax allowance before paying tax is £9440
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Simple Interest
Interest is calculated on the original investment
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Compound Interest
At the end of the period, interest is added on the new amount which includes all previous interest recieved
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National Insurance
http://getrevising.co.uk/resources/national_insurance
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Compound Interest Formulae
A = P (1+P)n
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Compound Interest Formulae
R = n(square root) A/P - 1
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Compound Interest
A = Amount accruing after n years
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Compound Interest
P = principal / amount invested
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Compound Interest
R = Annual Rate % (change to a decimal)
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## Other cards in this set

### Card 2

#### Front

Gross Profit / Cost Price x100

#### Back

Gross Profit Percentage

### Card 3

#### Front

The Multiplier is the amount added to find the answer. Example: £80 is 100% so what would 120% be? 80 x 120/100 = £96 = 80 x 1.20

#### Back ### Card 4

#### Front

http://getrevising.co.uk/resources/ratio_and_proportion

#### Back ### Card 5

#### Front

New Amount - Old Amount / Old Amount x 100

#### Back 