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course on business calculations pdf | 9 Exercises

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Application: Books of Knowledge

States :

The company "Books of Knowledge" specializes in the sale of educational books. With a recent increase in the cost of raw materials, the manager wants to optimize the management of his stocks. Three main titles make up the majority of annual sales, and we must evaluate their economic performance.

Work to do :

  1. Calculate the margin rate for the book “Modern Economy”, knowing that the purchase price excluding tax is €12 and the sale price excluding tax is €18.
  2. Determine the markup rate for the book “Easy Management”, whose purchase price excluding tax is €15 and whose sale price excluding tax is €25.
  3. Another book, called “Finances Simplifiées”, has an annual demand of 500 copies, an ordering cost of €50 and a storage cost of €2 per copy. Calculate the QEC for this title.
  4. If we want to set a sales price excluding tax to guarantee a markup rate of 30% on the book "Contemporary Analysis" purchased for €20, what should this price be?
  5. Analyze the strategic implications of a 10% reduction in the selling price of “Modern Economy”. What would be the impact on the margin rate?

Proposed correction:

  1. Margin rate = ((PV HT – PA HT) ÷ PA HT) x 100 = ((18 € – 12 €) ÷ 12 €) x 100 = 50%. The book has a margin rate of 50%.

  2. Markup rate = ((PV HT – PA HT) ÷ PV HT) x 100 = ((25 € – 15 €) ÷ 25 €) x 100 = 40%. The markup rate for “Easy Management” is 40%.

  3. QEC = ?((2 x Annual Demand x Order Cost) ÷ Storage Cost) = ?((2 x 500 x 50) ÷ 2) = ?(25000) = 158,11. Rounded to 158 copies, this is the QEC for “Simplified Finances”.

  1. To obtain a markup rate of 30%, we use the formula: PV HT = PA HT ÷ (1 – Markup rate). Calculating, €20 ÷ (1 – 0,30) = €28,57. The selling price excluding tax should be €28,57 to achieve the desired markup rate.

  2. A 10% reduction in the selling price of “Modern Economy” would reduce the price from €18 to €16,2. The new margin rate = ((€16,2 – €12) ÷ €12) x 100 = 35%. The lower selling price reduces the margin rate, potentially affecting profitability.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Brand taxes ((PV HT – PA HT) ÷ PV HT) x 100
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Tech Innovators

States :

Tech Innovators, a specialist in the sale of electronic gadgets, is looking to improve its financial performance in the face of a rapidly expanding technological market. They want to analyse the profitability of their flagship products and optimise their pricing policy.

Work to do :

  1. The product “SmartHome” is purchased at €100 excluding VAT and sold at €150 excluding VAT. Calculate the margin rate for this product.
  2. For the “EcoCharge” gadget, purchased for €80 excluding VAT and sold with a 20% markup, find the selling price excluding VAT.
  3. “Wireless Sound”, a product in the range, has an annual demand of 800 units, an ordering cost of €60 and a storage cost of €3. Calculate the QEC for this product.
  4. Determine the new selling price excluding VAT of “Tech Vision” to obtain a markup rate of 35%, knowing that the purchase price excluding VAT is €50.
  5. Discuss the impact of a 15% decrease in the selling price of “SmartHome” on its margins.

Proposed correction:

  1. Margin rate = ((€150 – €100) ÷ €100) x 100 = 50%. “SmartHome” displays a margin rate of 50%.

  2. Selling price excluding VAT = PA excluding VAT ÷ (1 – Markup rate) = €80 ÷ (1 – 0,20) = €100. The selling price excluding VAT of “EcoCharge” would be €100.

  3. QEC = ?((2 x 800 x 60) ÷ 3) = ?(32000) = 178,88. Approximated to 179 units, this is the QEC for “Wireless Sound”.

  1. PV HT = €50 ÷ (1 – 0,35) = €76,92. The new selling price excluding VAT for “Tech Vision” should be €76,92 to achieve the desired markup rate.

  2. With a 15% price reduction of “SmartHome”, its selling price increases to €127,5. The new margin rate = ((€127,5 – €100) ÷ €100) x 100 = 27,5%. The price reduction would significantly affect the product’s margin rate, thus reducing its profitability.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Express Mode

States :

Mode Express, a ready-to-wear clothing retailer, wants to re-evaluate its pricing strategy to remain competitive. The focus is on products from the Spring/Summer 2024 collection to analyze profitability and inventory efficiency.

Work to do :

  1. Calculate the margin rate for the “Summer 2024” dress, purchased at €30 excluding VAT and sold at €50 excluding VAT.
  2. If the “Luxe” blouse, purchased for €40 excluding VAT, is sold with a mark-up rate of 25%, determine the selling price excluding VAT.
  3. “Classic Pants” has an annual demand of 1 pieces, with an ordering cost of €000 and a storage cost of €70. Calculate the QEC.
  4. What should be the selling price excluding tax for the “Trendy Skirt” to obtain a markup rate of 28%, knowing that the purchase price excluding tax is €35?
  5. Evaluate the strategic implications of a 10% increase in the selling price of “Summer 2024”.

Proposed correction:

  1. Margin rate = ((€50 – €30) ÷ €30) x 100 = 66,67%. The “Summer 2024” dress generates a margin rate of 66,67%.

  2. Selling price excluding VAT = €40 ÷ (1 – 0,25) = €53,33. The selling price excluding VAT of the “Luxury Blouse” should be €53,33.

  3. QEC = ?((2 x 1 x 000) ÷ 70) = ?(5) = 28000. Rounded to 167,33 pieces, this is the QEC for the “Classic Pants”.

  1. PV HT = €35 ÷ (1 – 0,28) = €48,61. The selling price excluding VAT for the “Trendy Skirt” should be €48,61 to reach the recommended rate.

  2. A 10% increase in the selling price of “Summer 2024” would bring the price to €55. The new margin rate = ((€55 – €30) ÷ €30) x 100 = 83,33%. An increase in price would significantly improve the margin rate, potentially increasing profitability.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Gourmet Delights

States :

Gourmet Délices, a company specializing in the supply of gourmet food products, wants to improve its economic performance and better manage its inventory of fresh and dry products.

Work to do :

  1. Calculate the margin rate for the product “Truffle Paste”, with a purchase price of €40 excluding VAT and a sale price of €70 excluding VAT.
  2. If the jar of “Mountain Honey”, purchased for €5 excluding VAT, reaches a mark-up rate of 20%, determine its selling price excluding VAT.
  3. The “Chef’s Selection” box has an annual demand of 700 units, an ordering cost of €40, and a storage cost of €2. Calculate the QEC.
  4. Find the selling price excluding tax for a “Luxury Ham” in order to obtain a mark-up rate of 40%, knowing that its cost is €25 excluding tax.
  5. Analyze the strategic implications of reducing the selling price of “Pâte de Truffe” by 5%.

Proposed correction:

  1. Margin rate = ((€70 – €40) ÷ €40) x 100 = 75%. “Truffle Paste” has a margin rate of 75%.

  2. Selling price excluding tax = €5 ÷ (1 – 0,20) = €6,25. The selling price excluding tax of “Miel des Montagnes” would be €6,25.

  3. QEC = ?((2 x 700 x 40) ÷ 2) = ?(28000) = 167,33. Rounded to 167 units, this is the QEC for the “Chef’s Selection” box.

  1. PV HT = €25 ÷ (1 – 0,40) = €41,67. The “Hambon de Luxe” should be sold at €41,67 excluding VAT to reach the targeted mark-up rate.

  2. The 5% reduction would bring the selling price of “Pâte de Truffe” to €66,50. The new margin rate = ((€66,50 – €40) ÷ €40) x 100 = 66,25%. The price reduction would negatively impact the margin rate, which could reduce profits.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Green Energy

States :

Énergie Verte, a specialist in solar panel installations, wishes to optimize its products to meet growing demand and ensure better profitability in its installation projects.

Work to do :

  1. Calculate the margin rate for “EcoPlus” solar panels with a purchase cost of €200 and a sale price of €350 excluding VAT.
  2. “Pro Solar Battery”, purchased at €100 excluding VAT, must have a markup rate of 30%. What is the necessary selling price excluding VAT?
  3. “Solar Charger”, a side product with an annual demand of 600 copies, this implies an ordering cost of €30 and a storage cost of €1,5. Calculate the QEC.
  4. For a purchase price excluding VAT of €120, determine the sale price excluding VAT of the “Intelligent Inverter” to obtain a mark-up rate of 25%.
  5. Discuss the effect of an 8% increase in the selling price of “EcoPlus” on profitability and the potential impact on demand.

Proposed correction:

  1. Margin rate = ((€350 – €200) ÷ €200) x 100 = 75%. “EcoPlus” panels have a margin rate of 75%.

  2. Selling price excluding VAT = €100 ÷ (1 – 0,30) = €142,86. The “Pro Solar Battery” should be sold at €142,86 excluding VAT.

  3. QEC = ?((2 x 600 x 30) ÷ 1,5) = ?(24000) = 154,92. Approximated to 155 units, this is the QEC for the “Solar Charger”.

  1. PV HT = €120 ÷ (1 – 0,25) = €160. The “Intelligent Inverter” must be set at €160 excluding VAT to achieve the desired mark rate.

  2. Increasing the selling price of “EcoPlus” panels by 8% would bring the price to €378. The new margin rate would be ((€378 – €200) ÷ €200) x 100 = 89%. An increase could increase the margin but also affect the sensitivity to demand, so it will be necessary to evaluate the market reactions.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Health & Life

States :

“Santé & Vie”, an innovative company in the field of health products, focuses on organic products and wishes to refine its pricing and supply policies to maximize its profits while remaining competitive.

Work to do :

  1. Calculate the margin rate of a “BioActive Cream”, the purchase cost of which is €15 excluding VAT and the sale price €25 excluding VAT.
  2. If the “Natural Shampoo”, purchased for €10 excluding VAT, must have a brand rate of 22%, what selling price excluding VAT should you set?
  3. The “Vitality Plus” pack, with an estimated annual demand of 400 units, has an ordering cost of €45 and a storage cost of €3. Calculate the QEC.
  4. What would be the selling price excluding tax for the “Superfoods Supplement” in order to ensure a brand rate of 28%, knowing that this product costs €35 excluding tax to purchase?
  5. To analyze the effect of a 7% decrease in the price of “BioActive Cream” on the margin rate and customer perception.

Proposed correction:

  1. Margin rate = ((€25 – €15) ÷ €15) x 100 = 66,67%. The product “BioActive Cream” has a margin rate of 66,67%.

  2. Selling price excluding VAT = €10 ÷ (1 – 0,22) = €12,82. The selling price excluding VAT of the “Natural Shampoo” would be €12,82.

  3. QEC = ?((2 x 400 x 45) ÷ 3) = ?(12000) = 109,54. Rounded to 110 units, this is the QEC for the “Vitality Plus” pack.

  1. PV excluding VAT = €35 ÷ (1 – 0,28) = €48,61. The “Superfoods Supplement” should be sold at €48,61 excluding VAT to achieve the required mark-up rate.

  2. Reducing the price of “BioActive Cream” by 7% will lower the selling price to €23,25. The new margin rate = ((€23,25 – €15) ÷ €15) x 100 = 55%. Although the margin is reduced, the price reduction can increase the attractiveness of the product to price-sensitive consumers.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Contemporary Furniture

States :

Mobilier Contemporain, a manufacturer of designer furniture, is seeking to evaluate its pricing policies for its most popular creations, while ensuring optimal management of its supplies.

Work to do :

  1. Calculate the margin rate for the “Minimalist Chair”, which has a purchase cost of €80 excluding VAT and is sold at €150 excluding VAT.
  2. “Table Épurée” has a cost of €120 excluding VAT with a target mark-up rate of 25%, determine the selling price excluding VAT.
  3. “Modular Library” has an annual demand of 200 units, an ordering cost of €100, and a storage cost of €10. Calculate the QEC.
  4. Find the selling price excluding VAT for the “Relaxing Armchair” to obtain a markup rate of 33%, knowing that the purchase cost is €60 excluding VAT.
  5. Develop an analysis of the potential effect of a 10% reduction in the selling price of the “Minimalist Chair” on its profitability and attractiveness.

Proposed correction:

  1. Margin rate = ((€150 – €80) ÷ €80) x 100 = 87,5%. The “Minimalist Chair” has a margin rate of 87,5%.

  2. Selling price excluding VAT = €120 ÷ (1 – 0,25) = €160. The selling price excluding VAT for the “Table Épurée” should be €160.

  3. QEC = ?((2 x 200 x 100) ÷ 10) = ?(4000) = 63,25. Rounded to 63 units, this is the QEC for the “Modular Library”.

  1. PV HT = €60 ÷ (1 – 0,33) = €89,55. The “Relax Armchair” should be sold at €89,55 excluding VAT to obtain the targeted mark-up rate.

  2. Reducing the price of the “Minimalist Chair” by 10% would bring its selling price to €135. The new margin rate = ((€135 – €80) ÷ €80) x 100 = 68,75%. Such a reduction could attract new customers but also reduce profitability per unit, so higher volumes will have to be considered.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Cuisine and Flavors

States :

Cuisine et Saveurs, a supplier of high-end kitchenware, wants to review its pricing and logistics to align with market trends while optimizing its margins.

Work to do :

  1. Calculate the margin rate for the “Chef’s Knife” purchased at €20 excluding VAT and sold at €35 excluding VAT.
  2. “Poêle Pro” is purchased at €25 excluding VAT with a target mark-up rate of 15%. What selling price excluding VAT should be set?
  3. Determine the QEC for the “Set of Casseroles”, having an annual demand of 400, an ordering cost of €60, and a storage cost per unit of €4.
  4. What should be the selling price excluding VAT for the “Mandoline Deluxe” to obtain a mark-up rate of 20%, knowing that the purchase cost is €12 excluding VAT?
  5. Evaluate the strategic impact of a 12% increase in the price of the “Chef’s Knife” on its profitability.

Proposed correction:

  1. Margin rate = ((€35 – €20) ÷ €20) x 100 = 75%. The “Chef’s Knife” has a margin rate of 75%.

  2. Selling price excluding VAT = €25 ÷ (1 – 0,15) = €29,41. The “Pro Stove” should be sold at €29,41 excluding VAT.

  3. QEC = ?((2 x 400 x 60) ÷ 4) = ?(12000) = 109,54. Rounded to 110 units, this is the QEC for the “Casserole Set”.

  1. PV HT = €12 ÷ (1 – 0,20) = €15. The “Deluxe Mandolin” must be priced at €15 excluding VAT to ensure the mark rate.

  2. Increasing the price of the “Chef’s Knife” by 12% would put it at €39,20. The margin rate increases to ((€39,20 – €20) ÷ €20) x 100 = 96%. This increase significantly improves the unit margin but could influence the perception of value and potentially reduce sales volume.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

Application: Advanced Technology

States :

Advanced Technology, a newly established company in the high-tech electronics sector, wants to establish a solid foundation for calculating profitability and managing inventory of its key products.

Work to do :

  1. Determine the margin rate for the “Ambition Smartphone”, purchased at €400 excluding tax and sold at €650 excluding tax.
  2. To obtain a mark-up rate of 18%, what selling price excluding tax should be set for the “Ultralight Portable” computer purchased at €850 excluding tax?
  3. Calculate the QEC of the “Charging Station”, with an annual demand of 500, an ordering cost of €80, and a unit storage cost of €2,5.
  4. What would be the selling price excluding tax for the “Voice Assistant” in order to obtain a markup rate of 22%, if the purchase cost is €90 excluding tax?
  5. Analyze the effect of a 5% increase in the selling price of “Smartphone Ambition” on its profitability and market positioning.

Proposed correction:

  1. Margin rate = ((€650 – €400) ÷ €400) x 100 = 62,5%. The “Ambition Smartphone” has an attractive margin rate of 62,5%.

  2. Selling price excluding VAT = €850 ÷ (1 – 0,18) = €1036,59. The “Portable Ultraléger” should go on sale at €1036,59 excluding VAT.

  3. QEC = ?((2 x 500 x 80) ÷ 2,5) = ?(32000) = 178,88. Rounded to 179 units, this is the relevant QEC for the “Charging Station”.

  1. PV HT = €90 ÷ (1 – 0,22) = €115,38. Thus, the selling price excluding VAT of the “Voice Assistant” should be €115,38 for the desired markup rate.

  2. A 5% increase would bring the price of the “Ambition Smartphone” to €682,50. The new margin rate = ((€682,50 – €400) ÷ €400) x 100 = 70,63%. This increase may strengthen unit profitability but also risks changing the competitive dynamics of the market and negatively influencing consumer perceptions.

Formulas Used:

Title Formulas
Margin rate ((PV HT – PA HT) ÷ PA HT) x 100
Selling price excluding tax PA HT ÷ (1 – Mark rate)
QEC ?((2 x Annual Demand x Ordering Cost) ÷ Storage Cost)
PV HT with desired mark rate PA HT ÷ (1 – Mark rate)

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