Math for Managers

Appendix A Summary of Formulas

Accumulated value of a series of deposits:

$D\times \left({\left(1+R\right)}^n-1\right)÷R=A$

where: D	=	periodic deposit amount
R	=	periodic interest rate
n	=	number of periods
A	=	accumulated value

Adding fractions:

$\begin{array}{l}\left(n_1\times d_2\right)+\left(d_1\times n_2\right)=n_a\\ d_1\times n_2=d_a\end{array}$

where: n1	=	numerator, first fraction
d1	=	denominator, first fraction
n2	=	numerator, first fraction
d2	=	numerator, second fraction
na	=	numerator, answer
da	=	denominator, answer

After-tax return:

$O\times \left(1-T\right)=A$

where: O	=	operating (pre-tax) profit
T	=	combined federal and state tax rate (in decimal form)
A	=	after-tax profit

Amortization:

$C÷M=A$

where: C	=	total cost
M	=	months to amortize
A	=	amortization per month

Annual compounding:

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