FINANCES – PROFIT, LOSS AND DISCOUNT
Profit is the surplus remaining after total costs are deducted from total revenue. Revenue means your income.
Profit can be calculated in different ways. Normally when we talk about a 10% profit, we calculate it on the cost price. We sometimes also refer to a 10% markup.
Example: If I sell a football which cost me R200,00 for R220,00, I made a 10% profit.
Loss is the excess of expenditure over income.
Discount is the amount deducted from the asking price before payment.
Remember that profit and loss do not only apply to businesses but also to your personal income.
Are you making a profit or a loss in these examples. How much profit or loss?

 You are buying sweets for 45c and selling them for 65c each. I made a profit / loss of ___________(amount) per sweet.
 You are buying pencils for R2,00 each and selling them for R2,40 each to your friends. You manage to sell 40 pencils. I made a profit / loss of _____________________(amount).
 On Saturdays you hire a stall at the local fleamarket for R50,00. You are buying juice for R1.50 each and selling them for R2,50 each. Last Saturday it was cold, and you only managed to sell 40. I made a profit / loss of _____________ (amount).
 You are buying biscuits in large packets of 100 for R10,45 per packet. You are selling to your friends for 30c per biscuit. During the first break, you manage to sell 75 biscuits. I made a profit/ loss of _________________(amount).
 You are buying fruit directly from the market and selling it to your neighbours, friends, and family. Last weekend you bought 3 boxes of bananas. Each box contained 12 bunches of 12 bananas each. Each box cost you R75,00. You managed to sell 80% of the bananas at 65c each before the rest were too ripe and you had to throw them away. I made a profit/ loss of _______________(amount).

 You are buying sweets for 45 c each and you want to make a 25% profit. How much must you sell them for? _________________(amount).
 You are buying pens for R1,27 each and you want to make a 17% profit. How much must you sell them for? __________________(amount).
 On Sundays you hire a stall at the local fleamarket for R50,00. You buy juice for R1,50 per box and you normally sell 200 units per Sunday. If you want to make a 35% profit after paying for the stall, how much must you ask per fruit juice? _____________(amount).
FINANCES  BUDGET
Do you know what a budget is? Can I have my own budget or is it only for adults?
Budget is the estimate of cost and revenues over a specific period.
Budget is like a scale where you try to balance your income and your expenses. Important: Your income should always outweigh your expenses.
Creating a budget is the most important step in controlling your money. The first rule of budgeting is: Spend less than you earn!
Example: If you received a R250,00 allowance (pocket money) per month and another R80 for your birthday, you cannot spend more than R330,00 for the entire month.
Net income is, like profit, the surplus remaining after all costs are deducted from total (gross) revenue. If the expenses exceed the income, we call it a shortage.
It is always a bright idea to SAVE for a RAINY day!
What is a loan? What is interest?
A loan is a sum of money that an individual or a company lends to an individual or a company with the objective of gaining profits from interest when the money is paid back.
Interest is the fee charged by a lender to a borrower for the use of borrowed money, usually expressed as an annual percentage of the amount borrowed, also called interest rate.
There are two kinds of interest: Simple and compound. Simple or flat rate interest is usually paid each year as a fixed percentage of the amount borrowed or lent at the start. With compound interest, you also pay interest on the interest!
The simple interest formula is as follows:
Interest = Principal x Rate x Time
Where:
 Interest is the total amount of interest paid.
 Principal is the mount lent or borrowed.
 Rate is the percentage of the principal charged as interest each year.
 Time is the time in years to pay back the loan.
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