1.

First Benchmark Publishings gross

margin is 50% of sales. The operating costs
of the publishing are estimated at 15% of
sales. If the company is within the 40% tax
bracket, determine the percent of sales is
their profit after taxes?

A. 21 %

2. A farmer selling eggs at 50 pesos a dozen

gains 20%. If he sells the eggs at the same
price after the costs of the eggs rises by
12.5%, how much will be his new gain in
percent?

5. Engr. Trinidad loans from a loan firm an

amount of P100,000 with a rate of simple
interest of 20% but the interest was deducted
from the loan at the time the money was
borrowed. If at the end of one year, she has
to pay the full amount of P100,000, what is
the actual rate of interest?

6. A loan of P5,000 is made for a period of

15 months, at a simple interest rate of 15%,
what future amount is due at the end of the
loan period?

B. 29.17 %

4. The monthly demand for ice cans being

manufactured by Mr. Camus is 3200 pieces.
With a manual operated guillotine, the unit
cutting cost is P25.00. An electrically
operated hydraulic guillotine was offered to
Mr. Camus at a price of P275,000.00 and
which cuts by 30% the unit cutting cost.
Disregarding the cost of money, how many
months will Mr. Camus be able to recover
the cost of the machine if he decides to buy
now?

A. 5,937.50

B. 6.65 %

3. A feasibility study shows that a fixed

capital investment of P10,000,000 is
required for a proposed construction firm
and an estimated working capital of
P2,000,000. Annual depreciation is
estimated to be10% of the fixed capital
investment. Determine the rate of return on
the total investment if the annual profit is
P3,500,000.

C. 25.0 %

C. 12 months

7. Mr. Bacani borrowed money from the

bank. He received from the bank P1,842 and
promised to repay P2,000 at the end of 10
months. Determine the rate of simple
interest.

D. 10.29 %

8. A college freshman borrowed P2,000

from a bank for his tuition fee and promised
to pay the amount for one year. He received
only the amount of P1,920 after the bank
collected the advance interest of P80.00.
What was the rate of discount?

B. 4.00 %

9. It is the practice of almost all banks in the

Philippines that when they grant a loan, the
interest for one year is automatically
deducted from the principal amount upon
release of money to a borrower. Let us
therefore assume that you applied for a loan
with a bank and the P80,000 was approved
at an interest rate of 14% of which P11,200
was deducted and you were given a check of
P68,800. Since you have to pay the amount

of P80,000 one year after, what then will be

the effective interest rate?

B. 16.28 %

10. A man invested P110,000 for 31 days.

The net interest after deducting 20%
withholding tax is P890.36. Find the rate of
return annually.

B. 11.75 %

11. A investor wishes to earn 7% on his

capital after payment of taxes. If the income
from an available investment will be taxed
at an average rate of 42%, what minimum
rate of return, before payment of taxes, must
the investment offer to be justified?

A. 12.07 %

12. Mr. Jun Ramos was granted a loan of

P20,000 by his employer Excel First Review
and Training Center, Inc. with an interest of
6% for 180 days on the principal collected in
advance. The corporation would accept a
promissory note for P20,000 non-interest for
180 days. If discounted at once, find the
proceeds of the note.

A. P18,000

13. Miss Evilla borrowed money from a

bank. She receives from the bank P1,340.00
and promised to pay P1,500.00 at the end of
9 months. Determine the corresponding
discount rate or often referred to as the
bankers discount.

14. The exact simple interest of P5,000

invested from June 21, 1995 to December
25, 1995 is P100. What is the rate of
interest?

A. 3.90 %

15. What is the ordinary interest on

P1,500.50 for 182 days at 5.2%?

C. P39.45

16. A loan for P50,000 is to be paid in 3

years at the amount of P65,000. What is the
effective rate of money?

B. 9.14 %

17. What is the effective rate corresponding

to 18% compounded daily? Take 1 year is
equal to 360 days.

D. 19.72 %

18. What rate of interest compounded

annually is the same as the rate of interest of
8% compounded quarterly?

D. 8.24 %

19. Which of these gives the lowest effective

rate of interest?

D. 11.60 % compounded annually

20. An amount of P1,000 becomes

P1,608.44 after 4 years compounded
bimonthly. Find the nominal interest.

D. 13.73 %

B. 12.00 %

21. How long will it take money to double

itself if invested at 5% compounded
annually?

of 18% per year. How much lesser you will

pay by borrowing the money from the bank?

22. By the condition of a will, the sum of

P20,000 is left to a girl to be held in trust
fund by her guardian until it amounts to
P50,000. When will the girl receive the
money if fund invested at 8% compounded
quarterly?

C. 11.57 years

23. A sum of P1,000 is invested now and left

for eight years, at which time the principal is
withdrawn. The interest has accrued is left
for another eight years. If the effective
annual interest rate is 5%, what will be the
withdrawal amount at the end of the
16th year?

D. P705.42

24. Mandarin Bank advertises 9.5% account

that yields 9.84% annually. Find how often
the interest is compounded.

C. Quarterly

25. A student plans to deposit P1,500 in the

bank now and another P3,000 for the next 2
years. If he plans to withdraw P5,000 three
years from after his last deposit for the
purpose of buying shoes, what will be the
amount of money left in the bank after one
year of his withdrawal? Effective annual
interest rate is 10%.

C. P54.66

C. 14.2 years

A. P1,549.64

26. You borrow P3,500.00 for one year from

a friend at an interest rate of 1.5% per month
instead of taking a loan from a bank at a rate

27. 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%.

B. P 152.88

28. A firm borrows P2,000 for 6 years at

8%. At the end of 6 years, it renews the loan
for the amount due plus P2,000 more for 2
years at 8%. What is the lump sum due?

A. P 3,260.34

29. In year zero, you invest P 10,000.00 in a

15% security for 5 years. During that time,
the average annual inflation is 6%. How
much in terms of year zero pesos will be in
the account at maturity?

A. P 15,030.03

30. The institute of Electronics and

Communications Engineers of the
Philippines (IECEP) is planning to put up its
own building. Two proposals being
considered are:
A. The construction of the building now to
cost P 400,000
B. The construction of a smaller building
now to cost P300,000 and at the end of 5
years, an extension to be added to cost P
200,000.
By how much is proposal B more
economical than proposal A if interest rate is
20% and depreciation to be neglected?

D. P 19,624.49

31. What is the present worth of a P500

annuity starting at the end of the third year
and continuing to the end of the fourth year,
if the annual interest rate is 10 %?

B. P 717.17

32. What annuity is required over 12 years

to equate with a future amount of P 20,000?
Assume i= 6% annually.

B. P 1,185.54

33. A factory operator bought a diesel

generator set for P 10,000.00 and agreed to
pay the dealer uniform sum at the end of
each year for 5 years at 8% interest
compounded annually, that the final
payment will cancel the debt for principal
and interest. What is the annual payment?

36. A person buys a piece of lot for P

100,000 downpayment and 10 deferred
semi-annual payments of P 8,000 each,
starting three years from now. What is the
present value of the investment if the rate of
interest is 12% compounded semi-annually?

37. A young engineer borrowed P 10,000 at

12% interest and paid P 2,000 per annum for
the last 4 years. What does he have to pay at
the end of the fifth year in order to pay off
his loan?

B. P 7,731.29

35. A man loans P 187,400 from a bank with

interest at 5% compounded annually. He
agrees to pay his obligations by paying 8
equal annual payments, the first being due at
the end of 10 years. Find the annual
payments.

C. P 4,860.00

D. P 2,504.57

34. What is the present worth of a year

annuity paying P 3,000.00 at the end of each
year, with interest at 8% compounded
annually?

D. P 6,922.93

38. Miss Calledo deposited P 1,000, P 1,500

and P 2,000 at the end of the 2nd year,
3rd year and 4th year, respectively in a
savings account which earned 10% per
annum. How much is in the account at the
end of the 4th year?

A. P 142,999.08

D. P 43,763.20

39. A P 1,000,000 issue of 3%, 15-year bond

was sold at 95%. What is the rate of interest
of this investment?

A. 3.0%

40. A P 1, 000, 6% bond pays dividend

semiannually and will be redeemed at 110%
on June 21, 204. It is bought on June 21,
2001 to yield 4% interest. Find the price of
the bond.

B. P 1,144.81

41. A VOM has a selling price of P 400. If

its selling price is expected to decline at a
rate of 10% per annum due to obsolescence,
what will be its selling price after 5 years?

C. P 236.20

42. A machine costs of P 8,000 and an

estimated life of 10 years with a salvage
value of P 500. What is its book value after
8 years using straight line method?

A. P 2,000.00

43. ABC Corporation makes it a policy that

for any new equipment purchased, the
annual depreciation cost should not exceed
20% of the first cost at any time with no
salvage value. Determine the length of
service life necessary if the depreciation
used is the SYD method.

C. 9 years

44. An asset is purchased for P 9,000.00. Its

estimated economic life is 10 years after
which it will be sold for P 1,000.00. Find the
depreciation in the first three years using
sum-of-years digit method

A. $ 5,000,000.00

47. A manufacturer produces certain items at

a labor cost of P 115 each, material cost of P
76 each and variable cost of P 2.32 each. If
the item has a unit price of P 600, how many
units must be manufactured each month for
the manufacturer to break even if the
monthly overhead is P428,000

D. 1,053

48. A manufacturing firm maintains one

product assembly line to produce signal
generators. Weekly demand for the
generators is 35 units. The line operates for
7 hours per day, 5 days per week. What is
the maximum production time per unit in
hours required of the line to meet the
demand?

A. 1.0 hour per unit

B. P 3,927.27

45. Shell Philippines, 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%.

46. The Saudi Arabian Oil Refinery

developed an oil well which is estimated to
contain 5,000,000 barrels of oil at an initial
cost of $ 50,000,000. What is the depletion
charge during the year where it produces
half million barrels of oil? Use Unit or
Factor method in computing depletion.

C. P 9,250.00

49. A telephone switchboard 100 pair

cable can be made up with either
enameled wire or tinned wire. There will
be 400 soldered connections. The cost of
soldering a connection on the enameled
wire will be P 1.65 on the tinned wire, it
will be P 1.15. A 100- pair cable made
up with enameled wire cost P 0.55 per
linear foot and those made up of tinned
wire cost P 0.75 per linear foot.
Determine the length of cable run in feet

so that the cost of each installation

would be the same.

A. 1,000 feet

50. A leading shoe manufacturer produces a

pair of Lebron James signature shoes at a
labor cost of P 900.00 a pair and a material
cost of P 800.00 a pair. The fixed charges on
the business are P 5,000,000 a month and
the variable costs are P 400.00 a pair.
Royalty to Lebron James is P 1,000 per pair
of shoes sold. If the shoes sell at P 5,000 a
pair, how many pairs must be produced each
month for the manufacturer to break-even?

B. 2,632

the end of 9 months. Determine the simple

interest rate and the corresponding discount
rate or often referred to as the Bankers
Discount.

254. A man borrowed from the bank under a

promissory note that he signed in the
amount of P25000.00 for a period of 1year.
He received only the amount of P21,915.00
after the bank collected the advance interest
and an additional amount of P85.00 for
notarial and inspection fees. What was the
rate of interest that the bank collected in
advance?

251. A price tag of P1200 is specified if paid

within 60 days but offers a 3% discount for
cash in 30 days. Find the rate of interest.

A. 37.11%

252. It is the practice of almost all bank in

the Philippines that when they grant a loan,
the interest for 1 year is automatically
deducted from the principal amount upon
release of money to a borrower. Let us
therefore assume that you applied for a loan
with the bank and the P80000 was approved
at an interest rate of 14% of which P11200
was deducted and you were given ac check
of P68800. Since you have to pay the
amount of P80000 one year after, what then
will be the effective interest rate?

A. 16.28%

253. Mr. J. Dela Cruz borrowed money from

the bank. He received from the bank
P1,340.00 and promised to pay P1,500.00 at

A. 15.92% ; 13.73%

A. 13.64%

255. Karen was granted a loan of P20,000

by her employer CPM Industrial Fabricator
and Construction Corporation with an
interest at 6% for 180days on the principal
collected in advance. The corporation would
accept a promissory note for P20,000 noninterest for 180days. If discounted at once,
find the proceeds in the note.

A. P18,800

256. P4000 is borrowed for 75days at 16%

per annum simple interest. How much will
be due at the end of 75days?

B. P4133.33

257. Mr. Bautista made a money market

placement of P1,000,000 for 30 days at
7.5% per year. If withholding tax is 20%,
what is the net interest that Mr. Bautista will
receive at the end of the month?

D. P5,000

258. A bill for motorboat specifies the cost

as P1,200 due at the end of 100days but
offers a 4% discount for cash in 30days.
What is the highest rate, simple interest at
which the buyer can afford to borrow money
in order to take advantage of the discount?

D. 21.4%

259. In buying a computer disk, the buyer

was offered the options of paying P250 cash
at the end of 30days or P270 at the end of
120days. At what rate is the buyer paying
simple interest if he agree to pay at the end
of 120days?

A. 32%

260. On March 1, 1996 Mr. Sarmiento

obtains a loan of P1500 from Mr. Avila and
signs a note promising to pay the principal
and accumulated simple interest at the rate
of 5% at the end of 120days. On May 15,
1996, Mr. Avila discounts the note at the
bank whose discount rate is 6%. What does
he receive?

B. P1,513.56

261. A deposit of P110,000 was made for

31days. The net interest after deducting 20%
withholding tax is P890.36. Find the rate of
return annually.

C. 11.75

262. If you borrowed money from your

friend with simple interest of 12%, find the
present worth of P50,000 which is due at the
end of 7months.

B. P46,729

263. A man borrowed P2000 from a bank

and promise to pay the amount for 1year. He
received only the amount of P1,920 after the
bank collected an advance interest of P80.
What was the rate of discount and the rate of
interest that the bank collected in advance?

A. 4% ; 4.17%

264. An engineer promised to pay P36,000

at the end of 90days. He was offered a 10%
discount if he pays in 30 days. Find the rate
of interest.

B. 66.6%

265. A man is required to pay P200 at the

end of 160 days or P190 at the end of 40
days. Determine the rate of interest.

B. 15.8%

266. Compute the discount if P2000 is

discounted for 6 months at 8% simple
interest.

B. P76.92

267. The amount of P12800 in 4years at 5%

compounded quarterly is _____.

C. P15,614.59

268. A man borrows money from a bank

which uses a simple discount rate of 14%.
He signs a promissory note promising to pay
P500.00 per month at the end of 4th, 6th, and
7th month respectively. Determine the
amount of money that he received from the
bank.
A. P1403.68
269. A nominal interest of 3% compounded
continuously is given on the account. What

is the accumulated amount of P10,000 after

10 years?

275. How many years will P100,000 earn a

compound interest of P50,000 if the interest
rate is 9% compounded quarterly?

B. P13,498.60

270. BY the condition of a will, the sum of

P2000 is left to a girl to be held in trust fund
by her guardian until it amount to
P50000.00. When will the girl receive the
money of the fund is invested at 8%
compounded quarterly?

B. 11.57 years

271. A man expects to receive P25,000 in 8

years. How much is that worth now
considering interest at 8% compounded
quarterly?

D. P13,265.83

272. P500,000 was deposited at an interest

of 6% compounded quarterly. Compute the
compound interest after 4 years and 9
months.

A. P163,475.37

273. If the nominal interest rate is 3%, how

much is P5000 worth in 10 years in a
continuously compounded account?

C. P6750

274. P200,000 was deposited for a period of

4 years and 6 months and bears on interest
of P85649.25. What is the rate of interest if
it is compounded quarterly?

A. 8%

C. 4.55 years

276. A certain amount was deposited 5 years

and 9 months ago at an interest of 8%
compounded quarterly. If the sum now is
P315,379.85, how much was the amount
deposited?

A. P200,000

For Problems 277-279:

When compounded Bi-monthly, P15000
becomes P22,318.30 after 5years.
277. What is the nominal rate of interest?

C. 8%

278. What is the equivalent rate if it is

compounded quarterly?

C. 8.03%

279. What is the effective rate if it is

compounded quarterly?

A. 7.28%

280. How will it take a money to double

itself if invested at 5% compounded
annually?

B. 14.2 years

281. Compute the effective annual interest

rate which is equivalent to 5% nominal
annual interest compounded continuously.

A. 5.13%

282. Find the time required for a sum of

money to triple itself at 5% per annum
compounded continuously.

287. If the nominal interest is 12%

compounded continuously, compute the
effective annual rate if interest.

A. 12.75%

288. Compute the difference in the future

amount of P500 compounded annually at
nominal rate of 5% and if it is compounded
continuously for 5 years at the same rate.

A. 21.97 years

A. P3.87

289. If the effective rate is 24%, what

nominal rate of interest is charged for a
continuously compounded loan?
283. A man wishes to have P40,000 in a
certain fund at the end of 8 years. How
much should he invest in a fund that will
pay 6% compounded continuously?

A. P24,751.34

284. If the effective annual interest rate is

4%, compute the equivalent nominal annual
interest compounded continuously.

A. 3.92%

285. What is the nominal rate of interest

compounded continuously for 10 years if the
compound amount factor is equal to
1.34986?

A. 3%

286. American Express Corp. charges 1.5%

interest per month, compounded
continuously on the unpaid balance
purchases made on this credit card. Compute
the effective rate of interest.

A. 19.72%

A. 21.51%

290. What is the nominal rate of interest

compounded continuously for 8 years if the
present worth factor is equal to 0.6187835?

B. 6%

291. What is the difference of the amount 3

years from now for a 10% simple interest
and 10% compound interest per year?
(P5000 accumulated)

A. P155

292. Find the discount if P2,000 is

discounted for 6 months at 8% compounded
quarterly.

B. P77.66

293. If a sum of money triples in a certain

period of time at a given rate interest,
compute the value of the single payment
present worth factor.

A. 0.333

294. If the single payment amount factor for

a period of 5 years is 1.33822. What is the
nearest value of the interest rate?

D. 6%

299. If it was made at 16% compounded bimonthly.

300. If it was made at 16% compounded

continuously.

295. If the single payment present worth

factor for a period of 8 years is equal to
0.58201, compute the nearest value of the
rate of interest for that period.

C. 7%

A. 1.60844

297. A sum of P1,000 is invested now and

left for 8 years, at which time the principal is
withdrawn. The interest has an accrued left
for another 8 years. If the effective annual
interest is 5%, what will be the withdrawn
amount at the end of the 16th year?

C. P705.42

For problems 298 - 300:

Compute the interest for an amount of
P200,000 for a period of 8 years.

B. P256,000

C. 8%

302. Find the value of y, (P/F, 6%, y) if P/F

compounded bi-monthly is equal
to 0.787566.
D. 4 years

303. Find the rate of interest if compound

amount factor compounded bi-monthly for 5
years is equal to 1.487887.

C. 8%

304. Compute the nominal rate for a period

of 6 years for an effective rate of 8.33% if it
is compounded continuously.

C. 8%

305. Compute the equivalent compound

amount factor if it is compounded
continuously.

A. 1.61607

306. Compute the equivalent present

worth factor if it is compounded
continuously.

298. If it was made at a simple interest rate

of 16% .

D. P519,327.95

301. Find the value of x, (F/P, x, 6) if F/P

compounded quarterly is equal to 1.612226.

296. If money is worth 8% compounded

quarterly, compute the single payment
amount factor for a period of 6 years.

A. P507,267.28

D. 0.616783

307. A man loan P2000 from the bank. How

long would it take in years for the amount of
the loan and interest to equal P3280 if it was
made at 8% simple interest.

C. 8 years

308. A man loan P2000 from the bank. How

long would it take in years if it was made at
8% compounded quarterly.

C. 6.25 years

309. A man loan P2000 from the bank. How

long would it take in years if it was made
at 8% compounded continuously.

D. 6.18 years

310. An amount of P1000

becomes P1608.44 after 4
years compounded bi-monthly. Find the
nominal rate of interest, the effective rate of
interest, and the equivalent rate of interest if
it is compounded quarterly.

C. 12% ; 12.616% ; 12.06%

311. How long would it take your money

to double itself if it is invested at 6% simple
interest, compounded semi-quarterly, and
compounded continuously?

C. 16.67 yrs ; 11.6 yrs ; 11.55 yrs

For problems 312 - 314:

An amount of P50,000 was invested for 3
years.
312. Compute its interest at the end of 3
years if it is invested at 10% simple
interest.

B. P15,000.00

313. Compute for its compound interest if it

is invested at 10% compounded annually.

A. P16,550.00

314. Compute its interest if it is invested

at 10% compounded continuously.

C. P17,492.94

For Problems 315 - 317:

P200,000 was deposited for a period of 4

yrs. And 6 months and bears on interest of
P85,659.25.
315. What is the nominal rate of interest if it
is compounded quarterly?

C. 8.24%

316. What is the actual rate of interest?

C. 8.24%

317. What is the equivalent nominal rate if it

is compounded semi-quarterly?

D. 7.96%

318. What is the value of (F/P, 8%, 6) if it is

compounded semi-quarterly.

C. 0.787566127

319. What is the value of (P/F, 6%, 4) if it is

compounded bi-monthly.

C. 0.787566127

320. What is the single payment compound

amount factor for 8% compounded bimonthly for 5 years.

B. 1.487886717

For Problems 321 - 323:

If money is invested at a nominal rate of
interest of 8% for a period of 4 years.
321.) What is the effective rate if it is
compounded continuously?

A. 8.33%

322.) What is the value of the compound

amount factor if it is compounded
continuously?

A. 1.377128

323. What is the value of the present worth

factor if it is compounded continuously?

D. 0.726149

324. If the single payment amount factor for

a period of 5 years is 1.33822, what is the
nominal rate of interest?

A. 6.00%

325. What is the effective rate of interest if

it is compounded semi-annually of problem
no. 324?

D. 6.09%

326. What is the equivalent nominal rate if

it is compounded quarterly of problem no.
324?

D. 5.87%

327. Money was invested at x%

compounded quarterly. If it takes money
to quadruple in 17.5 years, find the value of
x.

B. 8.00%

328.) What is the actual interest rate of

problem no. 327?
C. 8.24%
329.) What is the equivalent rate if problem
no. 327 is compounded daily?

B. 7.92%

For Problems 330 - 332:

A businessman loaned P500,000 from a
local bank that charges an interest rate of
12%.

330. How much is he going to pay at the end

of 5 years if it was made at 12% simple
interest?

A. P800,000.00

331. How much is he going to pay at the end

of 5 years if it was made at 12% compound
semi-quarterly?

D. P907,009.21

332. How much is he going to pay at the end

of 5 years if it was made at 12% compound
continuously?

B. P911,059.20

333. P60,000 was deposited at

6% compounded quarterly, tax free for 9
years and 3 months. How much interest was
earned at the end of the period?

B. P44,086.60

334. P100,000 was placed in a time deposit

which earned 9% compounded
quarterly tax free. After how many years
would it be able to earn a total interest of
P50,000?

A. 4.56 years

335. P200,000 was placed in a time deposit

at x% compounded quarterly and was free
of taxes. After exactly 5 years, the total
interest earned was P120,000. What is the
value of x?

A. 9.5%

336. Which of these gives the lowest

effective rate of interest?

D. 11.6% compounded monthly

337. It takes 20.15 years to quadruple your

money if it is invested at x% compounded
semi-annually. Find the value of x.

B. 7%

338. It takes 13.87 years to treble the money

at the rate of x% compounded quarterly.
Compute the value of x.

D. 8%

339. Money was invested at x

% compounded quarterly. If it takes the
money into quadruple in 17.5 years, find the
value of x.

A. 8%

340. Fifteen years ago P1,000.00 was

deposited in a bank account, and today it is
worth P2.370.00. The bank pays interest
semi-annually. What was the interest rate
paid on this account?

C. 5.8%

341. You borrow P3,500.00 for one year

from a friend at an interest rate of 1.5% per
month instead of taking a loan from a bank
at a rate of 18% per year. Compare how
much money you will save or lose on the
transaction.

B. save P55 by borrowing from your

friend

342. Find the present worth of a future

payment of P1000,000 to be made in 10
years with an interest of 12% compounded
quarterly.

B. P30,655.68

343. An initial savings deposit of P80,000 in

a certain bank earns 6% interest per annum
compounded monthly. If the earnings from
the deposit are subject to a 20% tax, what
would the net value of the deposit be after
three quarters?

C. P82938.28

344. The effective rate of interest of 14%

compounded semi-annually is:

A. 14.49%

345. The amount of P50,000 was deposited

in a bank earning an interest of 7.5% per
annum. Determine the total amount at the
end of 5 years, if the principal and
interest were not withdrawn during the
period.

A. P71,781.47

346. What is the effective

rate corresponding to 18% compounded
daily? Take 1 year is equal to 360 days.

D. 19.72%

347. If P1,000 becomes P1,126.49 after 4

years when invested at a certain nominal
rate of interest compounded semi-annually,
determine the nominal rate and the
corresponding effective rate.

A. 3.00% and 3.02%

348. Convert 12% semi-annually

to compounded quarterly.

D. 11.83%

349. What is the corresponding effective

interest rate of 18% compounded semiquarterly?

C. 19.48%

350.) If P5000 shall accumulate for 10 years

at 8% compounded quarterly, find
the compounded interest at the end of 10
years.

B. P6,040.20

351. A couple borrowed P4,000 from a

lending company for 6 years at 12%. At the
end of 6 years, it renews the loan for the
amount due plus P4,000 more for 3 years at
12%. What is thelump sum due?

C. P16,712.03

352. How long (in years) will it take the

money to quadruple if it earns
7% compounded semi-annually?

D. 20.15 years

153. P200,000 was deposited on Jan. 1,1988

at an interest rate of 24% compounded
semi-annually. How much would the sum
be on Jan. 1, 1993?

D. P621,170

354. If P500,000 is deposited at a rate of

11.25% compounded monthly, determine
the compounded interest after 7 years and
9 months.

A. P690,849

355.) P200,000 was deposited at an interest

rate of 24% compounded semi-annually.
After how many years will the sum be
P621,170?

B. 5 years

356. A bank is advertising 9.5% accounts

that yields 9.84% annually. How often is
the interest compounded?

B. quarterly

357. A marketing company established a

program to replace the cars of its sales
representatives at the end of every 5 years. If
the present price of the approved type of car
is P520,000.00 with a resale value at the end
of 5 years of 60% its present value, how
much money must the company accumulate
for 5 years if inflation annually is 10%.
Release value will also appreciate at 10%
yearly.

A. P120,289.51

358. In year zero, you invest P10,000.00 in a

15% security for 5 years. During that time,
the average annual inflation is 6%. How
much, in terms of year zero will be in the
account atmaturity?
C. P15,030.00
359. A machine has been purchased and
installed at a total cost of P18,000.00. The
machine will be retired at the end of 5 years,
at which time it is expected to have a scrap
value of P2,000.00 based on current prices.
The machine will then be replaced with an
exact duplicate. The company plans to
establish a reserve fund to accumulate the
capital needed to replace the machine. If
an average annual rate of inflation of 3%
is anticipated, how much capital must be
accumulated?

C. P18,548.39

360. If the inflation rate is 6%, cost of

money is 10%, what interest rate will take
care of inflation and the cost of money?

A. 16.6%

361. A man bought a government bond

which cost P1000 and will pay P50 interest
each year for 20 years. The bond will mature
at the end of 20 years and he will receive the
original P1000. If there is 2% annual
inflation during this period, what rate of
return will the investor receive after
considering the effect of inflation?

A. 2.94%

362.) The inflated present worth of P2000 in

two years is equal to P1471.07. What is
the rate of inflation if the interest rate is
equal to 10%?

A. 6%

363. 12% rate of interest can take care of the

cost of money and inflation. If the nominal
rate of interest is 6%, what is the rate of
inflation?

C. 5.66%

364. An engineer bought an equipment for

P500,000. Other expenses including
installations amounted to P30,000. At the
end of its estimated useful life of 10 years,
the salvage value will be 10% of the first
cost. Using straight line method of
depreciation, what is the book value after 5
years?

A. P291,500

365. A small machine costing P80,000 has a

salvage value of x at the end of its life of 5
years. The book value at the end of the
4th year is P22,400. What is the value of x
using the straight line method
depreciation?

B. P8000

366. A machine has a salvage value of

P12,000 at the end of its useful life of 6
years. The book value at the end of 5 years
is P30,833.33. Using a straight line method
of depreciation,what is the first cost of the
machine?

B. P125,000

367. A manufacturing plant was built at a

cost of P5M and is estimated to have a life
of 20 years with a salvage value of P1M. A
certain equipment worth P570,000 was
installed at a cost of P80,000 is expected to
operate economically for 15 years with
a salvage value of P50,000. Determine
the book value of the plant and equipment
after 10 years, use straight line depreciation
method.

A. P3,250,000

368. A printing equipment costs P73,500 has

a life expectancy of 8 years and has a
salvage value of P3,500 at the end of its life.
The book value at the end of x years is equal
to P38,500. Using straight line method of
depreciation, solve for the value of x.

C. 4 years

369. The cost of the printing equipment is

P500,000 and the cost of handling and
installation is P30,000. If the book value of
the equipment at the end of the 3rd year is
P242,000 and the life of the equipment is
assumed to be 5 years, determine
the salvage value of this equipment at the
end of 5 years.

A. P50,000

370. An engineer bought an equipment for

P500,000. He spent an additional amount of
P30,000 for installation and other expenses.
The salvage value is 10% of the first cost. If
the book value at the end of 5 years will be
P291,500 using straight line method of
depreciation, compute the useful life of the
equipment in years.

A. 10 years

371. The cost of equipment is P500,000 and

the cost of installation is P30,000. 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 straight line method.

B. P146,000

For Problems 172-174:

The first cost of a machine is P1,800,000
with a salvage value of P300,000 at the end
of its life of 5 years. Determine the total
depreciation after 3 years.
372. Using Straight Line Method

B. P900,000

373. Using Sum of Years Digit Method

C. P1,200,000

374. Using Constant Percentage Method

C. P1,185,769.76

375. An asset is purchased for P9,000.00. Its

estimated economic life is 10 years after
which it will be sold for P1,000.00. Find
the depreciation in the first three
years using straight line method.

C. P2,400

376. The purchase of a motor for P6000 and

a generator for P4000 will allow the
company to produce its own energy. The
configuration can be assembled for P500.
The service will operate for 1600 hours per
year for 10 years. The maintenance cost is
P300 per year, and cost to operate is P0.85
per hour for fuel and related cost. Using
straight line depreciation, what is the annual
cost for the operation? There is a P400
salvage value for the system at the end of 10
year.

D. P2,670

377. A machine has an initial cost of

P50,00.00 and a salvage value of P10,000.00
after 10 years. What is the straight line
method depreciation rate as a percentage
of the initial cost?

C. 8%

378. A machine has an initial cost of

P50,00.00 and a salvage value of P10,000.00
after 10 years. What is the book value after
5 years using straight line method
depreciation rate?

D. P30,000

379. A machine has a first of P80,000 and a

salvage of P2,000 at the end of its life of 10
years. Find the book value at the end of the
6th year using straight line method of
depreciation.

A. P33,200

380. An asset is purchased for P90,000.00.

Its estimated life is 10 years after which it
will be sold for P1,000.00. Find the book
value during the first year if Sum of the
Years Digits(SYD) depreciation is used.

A. P7,545.45

381. A telephone company purchased a

microwave radio equipment for P6M.
Freight and installation charges amounted to
3% of the purchased price. If the equipment
shall be depreciated over a period of 8 years
with a salvage value of 5%, determine the
depreciation charge during the 5th year using
the Sum of Year Digit Method.

B. P652,333.33

382. A consortium of international

communications companies contracted for
the purchase and installation of a fiber optic
cable linking two major Asian cities at a
total cost of P960M. This amount includes
freight and installation charges at 10% of the
above total contract price. If the cable
depreciated over a period of 15 years with
zero salvage value, what is thedepreciation
charge during the 8th year using the sum of
year digits method?

A. P64 M

383. A machine cost P7,350 has a life of 8

years and has a salvage value of P350 at the
end of 8 years. Determine its book value at
the end of 4 years using sum years digit
method.

C. P2,294.44

384. A certain equipment costs P7,000 has

an economic life of n years and a salvage
value P350 at the end of n years. If the book
value at the end of 4 years is equal to
P2197.22, compute for the economic life of
the equipment using the sum of years digit
method.

B. 8 years

385. A company purchased an asset for

P10000 and plans to keep it for 20 years. If
the salvage value is zero at the end of the
20th year, what is the depreciation in the
third year? Use sum of years digit method.

C. P857

386. An equipment costs P7000 and has a

life of 8 years and salvage value of x after 8
years. If the book value of the equipment at
the 4th year is equal to P2197.22, compute
the salvage value x using the sum of years
digit method.

B. P350

387. ABC Corporation makes it policy that

for every new equipment purchased, the
annual depreciation should not exceed 20%
of the first cost at any time without salvage
value. Determine the length of service if the
depreciation used is the SYD Method.

D. 19 years

388. A machine having a certain first cost

has a life of 10 years and a salvage value of
6.633% of the first cost at the end of 10
years. If it has a book value of P58,914 at
the end of the 6thyear, how much is the first
cost of the machine if the constant
percentage of declining value is used in the
computation for its depreciation.(Mathesons
Method)

C. P300,000

389. A machine costing P720,000 is

estimated to have a life of 10 years. If the
annual rate of depreciation is 25%,
determine the total depreciation using a
constant percentage of the declining balance
method.

A. P679,454.27

390. An earth moving equipment that cost

P90,000 will have an estimated salvage
value of P18,000 at the end of 8 years.
Using double-declining balance method,
compute the book value and the total
depreciation at the end of the 5th year.

A. P21,357.42 ; P68,642.58

391. A certain office equipment has a first

cost of P20,000 and has a salvage value of
P1,000 at the end of 10 years. Determine
the depreciation at the end of the 6th year
using Sinking fund method at 3% interest.

C. P12,420

392. An equipment which cost P200,000 has

a useful life of 8 years with a salvage value
of P25,000 at the end of its useful life. If the
depreciation at the first year is P21,875,
what method is used in the calculation
of depreciation?

A. Straight Line

393. An equipment costs P8,000 has an

economic life of 8 years and salvage value
of P400 at the end of 8 years. The first year
depreciation amounts to P1,688.89. What
method is used in the calculation of
the depreciation?

D. Sum of Years Digit

394. The original cost of a certain machine

is P150,000 and has an economic life of 8
years with a salvage value of P9,000 at that
time. If the depreciation of the first year is
equal to P44,475, what method is used in the
calculation of the depreciation?

B. Declining Balance

395. A machine has a first cost of P140,000

and a life of 8 years with a salvage value of
P10,000 at the end of its useful life. If the
depreciation at the first year amounts to
P35,000, what method is used in the
calculation of depreciation?

A. Double Declining Balance

396. A hydraulic machine cost P180,000 and

has a salvage value of P15,000 at the end of
its useful life which is 12 years. If the
depreciation at the first year is P9,780.71,
what method is used in computing the
depreciation. Assume money is worth 6%
annually.

C. Sinking Fund

397. An equipment costs P480,000 and has a

salvage value of 10% of its cost at the end of
its economic life of 35,000 operating hours.
In the first year, it was used for 4,000 hours.
Determine its book value at the end of the
first year.

A. P430,629.00

398. An equipment costs P480,000 and has a

salvage value of 10% of its cost at the end of
its economic life of 36,000 operating hours
in a period of 5 years. In the first year of
service, it was used for 12,000 hours. If at
the end of the 2nd year it was used for 15,000
hours, find the depreciation at the second
year.

A. P180,000

399. A certain machine cost P40,000 and has

a life of 4 years and a salvage value of
P5000. The production output of this
machine in units per year is 1000 units for
the first year, 2000 units for the second year,
3000 units for the third year, and 4000 units
for the fourth year. If the units produced are
in uniform quality, what is the depreciation
charge at the end of the fourth year.

A. P14,000

400. A lathe machine costs P300,000 brand

new with a salvage value of x pesos. The
machine is expected to last for 28500 hours
in a period of 5 years. In the first year of
service it was used for 8000 hours. If the
book value at the end of the first year is
P220,000, compute for the salvage value x
in pesos.

A. P15,000

451. A bookstore purchased a best-selling

book at P200.00 per copy. At what price
should this book be sold so that by giving a
20% discount, the profit is 30%.

C. P400.00

452. A businessman wishes to earn 7% on

his capital after payment of taxes. If the
income from an available investment will be
taxed at an average of 42%, what minimum
rate of return, before payment of taxes, must
the investment offer to be justified?

B. 12.07%

453. A manufacturing firm maintains one

product assembly line to produce signal
generators. Weekly demand for the
generators is 35 units. The line operates for

7 hours per day, 5 days per week. What is

the maximum production time per unit in
hours required of the line to meet the
demand?

A. 1 hour

454. Froyd Corporations gross margin is

45% of sales. Operating expenses such as
sales and administration are 15% of sales.
Froyd Corporation is in 40% tax bracket.
What percent of sales is their profit after
taxes?

D. 18%

by 12.5%. If he sells at the same price as

before, find his new gain in %.

457. An equipment installation job in the

completion stage can be completed in 50
days of 8 hour/day work, with 50 men
working. With the contract expiring in 40
days, the mechanical engineer contractor
decided to add 15 men on the job, overtime
not being permitted.
If the liquidated damages is P5,000 per day
of delay, and the men are paid P150 per day,
how much money would he save with the
additional workers?

455. In determining the cost involved in

fabricating sub-assembly B within a
company, the following data have been
gathered:
Direct material - P0.30 per unit
Direct labor - P0.50 per unit

C. 6.58%

B. P43,750

458. In a certain department store, the

monthly salary of a saleslady is partly
constant and partly varies as the value of her
sales for the month. When the value of her
sales for the month is P10,000.00, her salary
for the month is P900.00. When her monthly
sales go up to P12,000.00, her monthly
salary goes up to P1,000.00. What must be
the value of her sales so that her salary for
the month will be P2,000.00?

Testing set-up - P300.00 per set-up

It is decided to subcontract the

manufacturing of assembly B to an outside
company. For an order of 100 units, what is
the cost per unit that is acceptable to the
company?

A. P3.80

456. By selling balut at P5 per dozen, a

vendor gains 20%. The cost of the eggs rises

C. P32,000

459. Jojo bought a second-hand Betamax

VCR and then sold it to Rudy at a profit of
40%. Rudy then sold the VCR to Noel at a
profit of 20%. If Noel paid P2,856 more
than it costs Jojo, how much did Jojo pay for
the unit?

D. P4,200

460. The selling price of a TV set is double

that of its net cost. If the TV set is sold to a
customer at a profit of 25% of the net cost,
how much discount was given to the
customer?

A. 37.5%

461. A Mechanical Engineer who was

awarded a P450,000 contract to install the
machineries of an oil mill failed to finish the
work on time. As provided for in the
contract, he has to pay a daily penalty
equivalent to one fourth of one per cent per
day for the first 10 days and 0.5% per day
for the next 10 days and one per cent per day
for everyday thereafter. If the total penalty
was P60,750.00, how many days was the
completion of the contract delayed?

money to be invested in government bonds

will give an annual return of 4.5% and the
stocks of about 6%. The investments are in
units of P100.00 each. If he desires to keep
his stock investment to minimum in order to
reduce his risk, determine how many stocks
should be purchased.

B. 166

464. A 220 V 2 hp motor has an efficiency

of 80%. If power costs P3.00 per kw-hr for
the first 50 kw-hr, 2.90 per kw-hr for the
second 50 kw-hr, P2.80 for the third kw-hr
and so on until a minimum of P2.50 per kwhr is reached. How much does it cost to run
this motor continuously for 7 days?

D. P860

A. 26 days

462. The quarrying cost of marble and

granite blocks plus delivery cost to the
processing plant each is P2,400.00 per cubic
meter. Processing cost of marble into tile is
P200.00 per square meter and that of the
granite into tiles also is P600.00 per square
meter.
If marble has a net yield of 40 square meters
of tile per cubic meter of block and sells
P400 per square meter, and granite gives a
net yield of 50 square meters of tiles per
cubic meter of block and sells at P1000 per
square meter. Considering all other costs to
be the same, the granite is more profitable
than the marble by how much?

465. An 8-meter concrete road pavement

500 meters long is desired to be constructed
over a well-compacted gravel road, together
with the necessary concrete curbs and
gutters on both sides. In order to put the
subgrade on an even level grade, a 500 cubic
meters of sand filling is necessary, over
which the 10 inch concrete pavement will be
placed?
Assume the following data:
A. Sand fill, including rolling and watering
= P100 per cubic meter

A. P12,000 per cubic meter

B. Concrete pavement, 10 in thick (labor

and materials) including curing = P220 per
sq. Meter

463. A man would like to invest P50,000 in

government bonds and stocks that will give
an overall annual return of about 5%. The

C. Curbs and gutters = P12 per linear meter

How much will the project cost allowing

15% for contingency?

Average hauling
distance

2.5 km

Monthly rental

P35,000 P6,500

B. P1,207,500

466. An electric utility purchases 2,300,000

kw-hr per month of electric energy from
National Power Corporation at P2.00 per
kw-hr and sells all this to consumers after
deducting distribution losses of 20%. At
what average rate per kw-hr should this
energy be sold to break even if the following
are other monthly expenses in its operation:
Taxes

2.5 % of gross revenue

Salaries

P750,000

Depreciation

P2,250,000

Installing and
dismantling of machine P20,000 P10,000
At Site A, it would be necessary to hire 2
flagmen at P150 per working day. The job
can be completed in 32 weeks working 6
days a week. The project requires 16,670
cubic meter of asphalt mix per kilometre of
road. If the asphalt mix is to be hauled by a
contractor at P42 per cubic meter per km of
haul. How much is site B more expensive
than site A?

Interest

P700,000

Maintenance

P300,000

A. P4.90

467. An engineer bidding on the asphalting

of 7 km stretch of road is confronted with a
problem of choosing between two possible
sites on which to set-up the asphalt-mixing
machine.

Site A

A. P949,645

468. A fixed capital investment of

P10,000,000 is required for a proposed
manufacturing plant and an estimated
working capital of P2,000,000. Annual
depreciation is estimated to be 10% of the
fixed capital investment. Determine the rate
of return on the total investment if the
annual profit is P2,500,000.

Miscellaneous P200,000

2.75 km

Site B

A. 28.33%

469. A call to bid was advertised in the

Philippine Daily Inquirer for the
construction of a transmission line from a
mini-hydroelectric power plant to the
substation which is 5.035 kilometers away.
The tanalized timber electrical posts must be
placed at an interval of 50 m. The electrical
posts must be 30 feet long, 8 inches in
diameter at the tip and 12 inches in diameter
at the butt. The power house is 15 m from

the first electric post and the substation is 20

m from the last electric post. Compute the
estimated cost for the project using the
following data:
Cost of one tanalized timber post 30 feet
long is P5,000 including delivery to the site.
Labourer at P180 per day and 5 laborers can
dig and erect 3 posts per day. Electrician at
P250 per day and 4 electricians can strung
wires complete 150 meters per day. Electric
wire cost P4.00 per meter. Use only 5
laborers and 4 electricians for the project
and is supervised by a foreman which is paid
at P400 per day. Contingency is 10% and
profit is 25%.

471. The monthly demand for ice cans being

manufactured by Mr. Alarde is 3200 pieces.
With a manual operated guillotine, the unit
cuffing cost is P25.00. An electrically
operated hydraulic guillotine was offered to
Mr. Alarde at a price of P275,000.00 and
which cuts by 30% the unit cuffing cost.
Disregarding the cost of money, how many
months will Mr. Alarde be able to recover
the cost of the machine if he decides to buy
now?

C. 12 months

D. P829,592.50

470. Upon the retirement after 44 years in

government service, Mrs. Salud Araoarao
was able to get a retirement lump sum of
P2,300,000. As a hedge against inflation, she
decided to use a part of it invested in real
state at Pagadian City and the remainder
were invested as follows:

472. In a new gold mining area in Southern

Leyte the ore contains on the average of ten
ounces of gold per ton. Different methods of
processing are tabulated as follows:

Processing
Method

Cost per ton % Recovery

B. 35% in money market placement earning

14%

P5,500

90

C. 35% in blue chip stock earning 13%

P2,500

80

P400

70

A. 30% in T-bills earning 12% interest

If her annual earnings from the T-bills,

money market and stock is P50,000, How
much did she invests in real estate?

B. P1,916,858.24

If gold can be sold at P4,000 per ounce,

which method of processing yield the
biggest return?

A. Processing method A

473. JRT Motors Inc. has been shipping its

Suzuki engines in containers to avoid the
necessary crating of the engines. JRT Motors
Inc. will pay freight on container load of 40
tons, regardless of whether or not the
container is completely filled with engines.
Record shows that due to engine size, JRT
Motors Inc. has shipped only 30 tons per
container. Freight of container cost P3.00
per kilograms.
If the engines are crated so that they can be
shipped at the rate of P3.50 per hundred
kilograms with the freight bill computed
only on the actual weight shipped. The cost
of crating would be P50 per engine and
would increase the shipping weight from
1500 kg to 1520 kg per engine. How much
more economical shipping the engine in
crates than in containers?

C. P473,000

475. If P1000 accumulates to P1500 when

invested at a simple interest for three years,
what is the rate of interest?

C. 16.67%

476. You loan from a loan firm an amount of

P100,000 with a rate of simple interest of
20% but the interest was deducted from the
loan at the time the money was borrowed. If
at the end of one year, you have to pay the
full amount of P100,000, what is the actual
rate of interest?

C. 25.0%

477. A loan of P5,000 is made for a period

of 15 months, at a simple interest rate of
15%, what future amount is due at the end of
the loan period?

B. P630 per engine

474. A paint manufacturing company uses a

sand mill for fine grinding of paint with an
output of 100 liters per hour using glass
beads as grinding media. Media load in the
mill is 25 kg costing P200.00 per kg and is
fully replenished in 2 months time at 8 hours
per day operation, 25 days a month. A
ceramic grinding media is offered to this
paint company, costing P400 per kg and
needs 30 kg load in the sand mill, but
guarantees an output of 120 liters per hour
and full replenishment of media in 3 months.
If profit on paint reduction is P15 per liter
how much is a difference in profit between
the two media?

A. P5,937.50

478. If you borrowed money from your

friend with simple interest at 12%, find the
present worth of P50,000, which is due at
the end of 7 months.

A. P46,728.97

479. Mr. J. Reyes borrowed money from the

bank. He received from the bank P1,842 and
promised to repay P2,000 at the end of 10
months. Determine the rate of simple
interest.

D. 10.29%

480. If you borrowed P10,000 from a bank

with 18% interest per annum, what is the
total amount to be repaid at the end of one
year?

C. P11,800

481. A price tag of P1,200 is payable in 60

days but if paid within 30 days it will have a
3% discount. Find the rate of interest.

D. 37.11%

482. A man borrowed P2,000 from a bank

and promised to pay the amount for one
year. He received only the amount of P1,920
after the bank collected an advance interest
of P80.00. What was the rate of discount?

B. 4.00%

483. A man borrowed P2,000 from a bank

and promised to pay the amount for one
year. He received only the amount of P1,920
after the bank collected an advance interest
of P80.00. What was the rate of interest that
the bank collected in advance?

C. 4.17%

484. What will be the future worth of money

after 12 months if the sum of P25,000 is
invested today at simple interest rate of 1%
per year?

D. P25,250

485. What will be the future worth of money

after 12 months if the sum of P25,000 is
invested today at simple interest rate of 1%
per month?

A. P28,000

486. 480 It is the practice of almost all banks

in the Philippines that when they grant a
loan, the interest for one year is
automatically deducted from the principal
amount upon release of money to a
borrower. Let us therefore assume that you
applied for a loan with a bank and the
P80,000 was approved at an interest rate of
14% of which P11,200 was deducted and
you were given a check of P68,800. Since
you have to pay the amount of P80,000 one
year after, what then will be the effective
interest rate?

B. 16.28%

487. A deposit of P110,000 was made for 31

days. The net interest after deducting 20%
withholding tax is P890.36. Find the rate of
return annually.

B. 11.75%

488. P5,000 is borrowed for 75 days at 16%

per annum simple interest. How much will
be due at the end of 75 days?

D. P5,166.67

489. A businessman wishes to earn 7% on

his capital after payment of taxes. If the
income from an available investment will be
taxed at an average rate of 42%, what
minimum rate of return, before payment of
taxes, must the investment offer to be
justified?

A. 12.07%

490. A man borrowed P20,000 from a local

commercial bank which has a simple interest
of 16% but the interest is to be deducted
from the loan at the time that the money was
borrowed and the loan is payable at the end
of one year. How much is the actual rate of
interest?

A. 19.05%

491. P4,000 is borrowed for 75 days at 16%

per annum simple interest. How much will
be due at the end of 75 days?

C. P4,133.33

492. Agnes Abanilla was granted a loan of

P20,000 by her employer CPM Industrial
Fabricator and Construction Corporation
with an interest rate of 6% for 180 days on
the principal collected in advance. The
corporation would accept a promissory note
for P20,000 non-interest for 180 days. If
discounted at once, find the proceeds of the
note.

A. P18,800

493. If you borrow money from your friend

with simple interest of 12%, find the present
worth of P20,000 which is due at the end of
nine months.

D. 13.64%

495. Mr. Danilo Conde borrowed money

from a bank. He received from the bank
P1,340.00 and promised to pay P1,500.00 at
the end of 9 months. Determine rate of
simple interest.

A. 15.92%

496. Mr. J. Dela Cruz borrowed money from

a bank. He receives from the bank P1,340.00
and promised to pay P1,500.00 at the end of
9 months. Determine the corresponding
discount rate or often referred to as the
bankers discount.

D. 13.73%

497. Annie buys a television set from a

merchant who ask P1,250.00 at the end of
60 days. Annie wishes to pay immediately
and the merchant offers to compute the cash
price on the assumption that money is worth
8% simple interest. What is the cash price?

B. P1,233.55

498. A man borrowed money from a loan

shark. He receives from the loan shark and
amount of P1,342.00 and promised to repay
P1,500.00 at the end of 3 quarters. What is
the simple interest rate?

C. P18,348.62

494. A man borrowed from a bank under a

promissory note that he signed in the
amount of P25,000.00 for a period of one
year. He receives only the amount of
P21,915.00 after the bank collected the
advance interest and an additional of P85.00
for notarial and inspection fees. What was
the rate of interest that the bank collected in
advance?

B. 15.69%

499. Determine the exact simple interest on

P5,000 invested for the period from January
15,1996 to October 12,1996, if the rate
interest is 18%.

D. P666.39

500. The exact simple interest of P5,000

invested from June 21,1995 to December
25,1995 is P100. What is the rate of interest?

A. 3.90%