[Music]
"Solving Trade Discount Word Problems"
There is an alternative method for
solving trade discount word problems
that requires you to memorize only one
equation rather than the multiple
equations shown in most text
presentations. The beauty of this
algorithm is that it can solve for any
of the three percentages or three dollar
values. The following formula will be
used for every problem: List Price -
Trade Discount equals Net Cost. Acronyms
will be substituted to create this form
of the same formula: LP - TD equals NC.
This method has user-friendly
proportions. Percentages will be placed
on top of each term in the equation, and
monetary values will be placed on the
bottom. Remember that the net cost
equivalent percentage will always go
over the net cost, and the single
discount equivalent will go over the
trade discount. The list price is the
base, so 100 percent will always be above
it. Do not round any percentages unless
the directions tell you to. Round the monetary
values to the nearest cent, if necessary.
Example 1: The net cost of an item is
500 dollars, and the trade discount series is 20
over 10. Find the list price. Step 1: Find
the net cost equivalent by multiplying
the complements (in decimal form) of the
trade discount rates in the series 20
over 10.
Step 2: Find the single discount
equivalent by subtracting the net cost
equivalent from 100 percent. Now, set up the
equation. Insert the given monetary value,
NC equals 500 dollars, and the rates into their
proper positions.
For ease of calculation, DO NOT include
the percent symbols with the rates. If
the answer is a rate, you must include
the percent symbol in the answer. Allow
for wide gaps between the values in case
the rates are lengthly numbers. The three
proportions do not include the formula
in the middle.
Always pull away the proportion that
includes the value you are solving for
and the proportion that has two known
values. Use the acronym instead of just a
blank for what you are solving for.
Now simply cross multiply and divide.
Round the monetary values to the nearest
cent and the rates to the nearest tenth
of a percent. Here, LP equals
694 dollars and 44 cents.
Example two: Find the trade discount if
the net cost is 250 dollars
and the trade discount series is
5 over 15.
Now set up the equation. Again, pull down
the proportion with the value you are
solving for and the proportion with the
two known numbers. Cross multiply and
divide to find TD, round to the
nearest cent, if necessary. TD equals
59 dollars and 60 cents.
In this last example, we will solve for the
trade discount rate. Two of the monetary
values will be given, and the third value
can be found by addition or subtraction,
depending upon what is given. Example 3,
find the trade discount rate if the net
cost is 85 dollars and the trade discount is
19 dollars. Hint: Find the list price by adding
the net cost and the trade discount. LP
minus TD equals NC. Now substitute the
given values into the equation.
LP equals 104 dollars. Now set up the
equation. LP minus TD equals NC. TDR
equals 18.3 percent.
Congratulations! You have completed
"Solving Trade Discount Word Problems."