E-Cons

Question 1

Find the exact interest on P 2,000
invested for a period form Jan 30,
2001 to September 15, 2001, if
interest rate is 10%?

Answer 1

P 124.59

Question 2

In how many years is required for P
2,000 to increase by P 3,000 if
interest at 12% compounded semiannually?

Answer 2

7.86 years

Question 3

Find the present value in pesos, of a
perpetuity of P15,000 payable semiannually if money is worth 8%
compounded quarterly.

Answer 3

P 371,287.13

Question 4

Which of these give the lowest
effective rate of interest?

Answer 4

11.60 % compounded monthly

Question 5

An equipment costs P 10,000 with a
salvage value of P 500 at the end of
10 years. Calculate the annual
depreciation cost by sinking fund
method at 4 % interest.

Answer 5

P 791.26

Question 6

XYZ Corporation manufactures
bookcases that sell for P 65.00 each.
It costs XYZ Corporation P 35,000
per year to operate its plant. This sum
includes rent, depreciation charges on equipment, and salary payments. If
the cost to produce one bookcase is P
50.00, how many cases must be sold
each year for XYZ to avoid taking a
loss?

Answer 6

2,334

Question 7

A debt of P 10,000 with 10 % interest
compounded semi-annually is to be
amortized by semi-annual payment
over the next 5 years. The first due in
6 months. Determine the semi-annual
payment.

Answer 7

P 1,295.05

Question 8

A machine has an initial cost P
100,000 and salvage value of P
20,000. Find the straight-line method
depreciation rate, expressed as a
percentage of the initial cost.

Answer 8

8 %

Question 9

Erwin borrowed from Tibur an
amount of P 5,000 and promised to
pay it in one year. After paying Tibur
an advance interest of P 250, he has
to pay the total amount of P 5,000 at
the end of one year. What was the
rate of interest?

Answer 9

5 %

Question 10

What is the factor name of the
formula [i(1+i)^n]/[(1+i)^n]-1?

Answer 10

Capital recovery

Question 11

The ratio of quick assets to current
liabilities is called _______.

Answer 11

acid-test ratio

Question 12

How long (in years) will it take
money to quadruple if it earns 7 %
compounded semi-annually?

Answer 12

20.15

Question 13

What is the present worth of two P
100 payments at the end of the third
year and fourth year? The annual
interest rate is 8%.

Answer 13

P 153

Question 14

Money borrowed today is to be paid
in 6 equal payments at the end of 6
quarters. If the interest is 12 %
compounded quarterly. How much
was initially borrowed if quarterly
payment is P 2000.00?

Answer 14

P 10,834.38

Question 15

Mr. Cruz plans to deposit for the
education of his 5 years old son, P
500 at the end of each month for 10
years at 12% annual interest
compounded monthly. The amount
that will be available in two years is
_____.

Answer 15

P 13,000

Question 16

A machine costing P 720,000 is
estimated to have a book value of P
40,545.73 when retired at the end of
10 years. Depreciation cost is
computed using a constant percentage
of the declining book value. What is
the annual rate of depreciation in %?

Answer 16

25

Question 17

The cost of equipment is P 500,000
and the cost of installation is P
30,000. If the salvage value is 10% of
the cost of equipment at the end of 5
years, determine the book value at the
end of the fourth year. Use straightline method.

Answer 17

P 146,000

Question 18

The value [i/(1+i)^n -1] is known as
_________.

Answer 18

A. sinking fund factor

Question 19

Determine the exact simple interest
on P 5,000 invested for the period
from January 15, 1996 to October 12,
1996, if the rate of interest is 18%.

Answer 19

P 666.39

Question 20

A mine is for sale. A mining engineer
estimates that, at current production
levels, the mine will yield an annual
net income of P 80000 for 15 years,
after which the mineral will be
exhausted. If an investor’s MARR is
15%, what is the maximum amount
he can bid on this property?

Answer 20

P 467,760

Question 21

A machine which costs P50 000 when
new has a 10-year lifetime and a
salvage value equal to 10% of its
original value. Determine the capital
recovery, based upon an interest rate
of 8% per year, compounded
annually.

Answer 21

P 7,106.32

Question 22

A new broiler was installed by a
textile plant at a total cost of P
300,000 and projected to have a
useful life of 15 years. At the end of
its useful life, it is estimated to have a
salvage value of P 30,000. Determine
its capitalized cost if interest is 18%
compounded annually.

Answer 22

P 322,549.33

Question 23

A duplicating machine was purchased
at P 80,000. What is the capitalized
cost of perpetual service of this
machine if its annual cost is P
12,000? Use interest rate of 6%.

Answer 23

P 280,000

Question 24

A multinational company, has a total
gross income for a particular year of
P 50,000,000. The taxable income
after taking all deductions except for
depletion is P 18,500,000. What is the
allowable depletion allowance for
that particular year? Take percentage
of gross income for oil as 22%.

Answer 24

P 9,250,000

Question 25

Maintenance expenditures for a
structure with a twenty-year life will
come as periodic outlays of P 1,000 at
the end of the fifth year, P 2000 at the
end of the tenth year, and 3500 at the
end of the fifteenth year. With interest
at 10%, what is the equivalent
uniform annual cost of maintenance
for the twenty-year period?

Answer 25

P 262