Marketing Essentials
n Chapter 16 Using Math in Sales
Section 16.2 Sales Transactions
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
What You'll Learn
 The various types of sales transactions
 The math necessary to calculate sales checks
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Why It's Important
Although cash is used for payment in many
transactions, an ever-greater proportion of
sales involves the use of debit cards or
credit cards. Understanding how to handle
such sales will be necessary on many
sales jobs, and this section explains how
it is done.
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SECTION 16.2
Sales Transactions
Key Terms
 cash sale
 return
 debit card
 exchange
 floor limit
 allowance
 layaway
 sales tax
 on-approval sale
 parcel post
 cash on delivery
(COD) sale
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Retail Sales
As a salesperson or cashier, you will handle
several types of sales transactions such as:
 cash
 debit or credit card sales
 layaway (or will-call) sales
 on-approval sales
 COD sales
Slide 1 of 2
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SECTION 16.2
Sales Transactions
Retail Sales
As a salesperson or cashier, you will also be
dealing with:
 returns
 exchanges
 allowances
 sales tax
 shipping charges
Slide 2 of 2
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Cash Sales
A cash sale is a transaction in which the
customer pays for his or her purchase with
cash or a check.
 Cash payment Record the transaction on
the register, give the customer change and
a cash register receipt, and wrap or bag
the purchase.
 Check payment Policies vary, but you
will probably have to check the customer's
identity.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Debit Card Sales
When a customer uses a debit card the amount of
the purchase is debited (or subtracted) from his or
her bank account.
 The customer slides his or her card through a
device that reads its magnetic strip.
 Once the sale is totaled, the customer enters
a personal identification number.
 The sale is approved (or rejected)
electronically.
 The customer receives a receipt.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Credit Sales
Credit cards, such as Visa, MasterCard,
American Express, and department store or
oil company cards, make it easier for people
to shop. In many businesses, credit card
sales are processed electronically, giving
the business quick access to funds.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Getting Credit Authorizations
The floor limit is the maximum amount a
salesperson may allow a customer to
charge without getting special authorization
from a manager or credit department within
the store.
Slide 1 of 2
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Getting Credit Authorizations
To approve a charge for a sale, most
businesses use electronic credit
authorizers (often integrated into POS
systems). With electronic credit
authorizers, a sales clerk swipes the card,
inputs the amount of the sale into the
device, and waits for electronic approval
or disapproval.
Slide 2 of 2
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SECTION 16.2
Sales Transactions
Recording Credit Sales
With credit card sales, you will have to know
how to complete credit card sales checks.
The math is identical to the cash transaction.
There are usually three copies of the sales
check: for the customer, the retailer, and the
credit card agency. Many businesses record
credit sales electronically.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Obtaining Payment
Credit card sales checks for charges to
bank cards (Visa, MasterCard, etc.) may be
deposited into the bank, like checks, with
a special deposit slip. Sales checks for most
other cards must be sent to the issuing
company for payment.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Layaway Sales
With layaway, or will-call, merchandise is
removed from stock and kept in a separate
storage area until the customer pays for it.
The customer makes a deposit on the
merchandise and agrees to pay for the
purchase within a certain time period.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
On-Approval Sales
On-approval sale is an agreement that
permits a customer to take merchandise
(usually clothing) home for further
consideration. If the goods are not returned
within an agreed-upon time, the sale is final.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
COD Sales
A cash on delivery (COD) sale is a
transaction that occurs when a customer
pays for merchandise at the time of
delivery.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Returns, Exchanges, and Allowances
A return is merchandise brought back for a
cash refund or credit.
An exchange is merchandise brought back
to be replaced by other merchandise.
An allowance is a partial return of the sale
price for merchandise that the customer has
kept, usually because of a defect in the
merchandise.
Slide 1 of 2
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SECTION 16.2
Sales Transactions
Returns, Exchanges, and Allowances
 Returning an item for a replacement that
is priced the same is an even exchange.
 If the original item is priced more than
the new item, refund the difference to
the customer, including tax.
 If the original item is priced less, the
customer pays the difference, including tax.
Slide 2 of 2
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Refund Slip
Most businesses give
customer refunds or
exchanges under
certain circumstances.
Why would the store
insist the customer
have a sales receipt
before giving a refund?
If you owned a retail
store, what would be
your refund policy?
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Sales Tax
A sales tax is a government fee placed
on the sale of goods and services. These
rates differ from state to state and combine
local and state charges. Sales tax does not
apply to wholesale goods.
Chapter 16 n Using Math in Sales
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SECTION 16.2
Sales Transactions
Shipping Charges
Shipping charges are generally exempt
from sales tax, so they are added after the
sales tax has been calculated. There are
several options for shipping merchandise,
including:
 parcel post
 express mail
Slide 1 of 3
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SECTION 16.2
Sales Transactions
Shipping Charges
Parcel Post Costs depend on the service,
weight of the parcel, and shipping distance.
Parcel post is a good option if your
customer is willing to wait for delivery.
When you ship COD, the postal carrier will
collect the amount due and forward it to
your company. Your company must prepay
the shipping charges.
Slide 2 of 3
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SECTION 16.2
Sales Transactions
Shipping Charges
Express Mail This is a fast, more
expensive delivery service provided by the
U.S. Postal Service and other companies.
Costs are based on the weight of the
package and the distance.
Slide 3 of 3
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16.2 ASSESSMENT
Reviewing Key Terms and Concepts
1. How is a credit card sale different from a
debit card sale? A will-call sale? An onapproval sale?
2. What is the difference between a return and
an exchange?
3. Kim is considering the purchase of a new
guitar for $950, plus $24 shipping. The state
sales tax is 8 percent. How would Kim go
about figuring the total purchase amount?
Chapter 16 n Using Math in Sales
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16.2 ASSESSMENT
Thinking Critically
People have suggested that as more
buyers use debit cards, checks will become
obsolete. Do you think this is likely? Why or
why not?
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Marketing Essentials
End of Section 16.2
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