Commission, Net Fare/ Nett Nett, Gross

Gross Price:
The price paid by a customer for a holiday and includes commission.

Nett Price/ Fare:

The amount the Agent sends to the wholesaler or supplier as a booking payment after the
commission has been deducted.

Commission
An amount or % of the gross price that the travel agent receives.

Mark – up:
Amount added to a nett amount when on-selling.
Example
Gross Price
(paid by customer) $1,500
Commission = Gross – Nett Fare
Commission 10%
Nett Fare = Gross – Commission
(agent retains) $150
Gross = Net fare + Commission
Nett Price
(wholesaler receives) $1,350

Calculating the Commission

Multiply the Gross amount by the % (in this case it is 10% commission)
$1,500 x 10% = $150 commission OR
$1,500 x 10  100 = $150 commission

Calculating Mark-Ups
In this case you are marking $1,500 up by 15%
Step 1: 100 – 15 = 85
Step 2: Put a decimal point in front of 85 to make .85
Step 3: Divide $1,500 by .85 = $1,764 (this is the selling price or gross price)

To work out how much commission has been added in $$, take away $1,500 (the original price) from
$1,764 (the selling price). This will give you $264, which is how much the amount has been Marked-
Up by.

$1,764 - $1,500 = $264 (this is your Mark-Up price)

Calculating Currency
Foreign Currency to AUD
Foreign currency amount  ROE = AUD amount.
Example:
In this case the NZD ROE is 1.05 and you want to exchange NZD900 into AUD
NZD900  1.05 = AUD857.14

AUD to Foreign Currency

Australian Dollar amount X ROE = Foreign Currency amount.
Example:
In this case you have AUD1500 and want to change it to NZD and the rate is still 1.05
AUD1,500 x 1.05 = NZD1,575

How to find the ROE

Ending amount (new currency)  starting amount (original currency)
ROE = Rate of Exchange