| Re: Math Formula Question - Need Ideas [message #184519 is a reply to message #184517] |
Sun, 05 January 2014 01:22   |
Jerry Stuckle
Messages: 2598
Registered: September 2010
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Senior Member |
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On 1/4/2014 7:54 PM, Denis McMahon wrote:
> On Sun, 05 Jan 2014 00:26:08 +0000, Adrienne Boswell wrote:
>
>> I have a math question to which I can't find the answer. Here is the
>> scenario:
>>
>> Someone goes to a store and has $100.00 worth of items. The merchant
>> gives the customer a 10% discount, so only $90.00 is sent to the bank.
>> Of the original amount, $10.00 goes to the customer for the discount,
>> $80.00 goes to the merchant, $10.00 goes for a processing fee. But
>> those amounts have to be calced on the original amount, not what the
>> bank got. I need a formula to find the original amount if I have the
>> percentage (10%) and the amount the bank got ($90.00). I know in my
>> head that the original amount is $100.00, but I have to do it
>> programatically.
>>
>> I know this is probably dead simple, but I just can't get my head around
>> it.
>>
>> Thanks in advance.
>
> If a * b = c then
>
> a = c / b
>
> b = c / a
>
> In your case, 100 * 0.9 = 90
>
> Therefore to get the original,
>
> 90 / 0.9 = 100
>
> 0.9 being the decimal fraction that equates to 90%, ie the amount the
> customer paid after discount.
>
> Observation though, processing fees are usually a % of the amount paid.
>
> eg if a card payment processing service charges 1.25%, that would be
> 1.25% of the payments made, so in your case:
>
> Invoice: = 100.00
> Discount: 10% = 10.00
> Amount due: = 90.00
> ========================
> Processing: 10% = 9.00
> Amount to bank: = 81.00
>
> The payment processing is only concerned with the amount of the
> transaction that it actually processes, not some other intermediate
> calculation between the merchant and the customer.
>
> Consider the case where the customer is given a 95% discount by the
> store. If your processing service still charges 10% of the original
> amount, the your processing fee is more than actual transaction value:
>
> Invoice: = 100.00
> Discount: 10% = 95.00
> Amount due: = 5.00
> ==================================
> Processing: 10% of 100.00 = 10.00
> Amount to bank: = -5.00 ???? Error
>
> The correct math for this case is more likely:
>
> Invoice: = 100.00
> Discount: 10% = 95.00
> Amount due: = 5.00
> ========================
> Processing: 10% = 0.50
> Amount to bank: = 4.50
>
> As a general rule, payment processing systems only concern themselves
> with the amounts that they are handling, and not other amounts that may
> have appeared in calculations made outside of their own systems.
>
> Of course, if you're working on something like a sales commission basis,
> that might be a different set of rules, as you might expect to be
> receiving a commission based on the listed price, regardless of whether
> the items are sold at a discount or not.
>
Actually, Denis, since the original statement was the processor gets
$10, he would get $10/$90 or 11.11% of the sale.
--
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Jerry Stuckle
JDS Computer Training Corp.
jstucklex(at)attglobal(dot)net
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