SIMPLE INTEREST

1. If P2000 is accumulated from P800 when invested at simple interest for three years,
what is the rate of interest? (Ans: 50%)

2. You loan an amount of P10,000 with a rate of simple interest of 10% but the interest is
deducted from the loan at the time the money was borrowed. If at the end of 1 year
you have to pay the full amount of P10,000 what is the actual rate of interest? (Ans:
11.11%)

3. A loan of P2,000 is made for a period of 13 months at a simple interest rate of 20%,
what future amount is due at the end of the loan period? (Ans: P2433.33)

4. If you borrowed money from Batman with simple interest of 12% find the present worth
of P5,000 which is due at the end of 11months. (Ans: P4504.50)

5. Mr. Somebody borrowed money from the bank. He received P1,500 from the bank and
promised to repay P2,100 after 9 months. Determine the rate of simple interest. (Ans:
53.33%)

6. If Green Lantern borrowed P100,000 from the bank with 16% interest per annum what
is the amount to be repaid at the end of one year? (Ans: P116000)

7. 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. (Ans: 37.11%)

8. An alien borrowed P3,000 from a bank and promised to pay the amount for 2 years.
He received only the amount P2,900 after the bank collected an advance interest of
P100. What was the rate of discount? (Ans: 3.33%)

9. An alien borrowed P3,000 from a bank and promised to pay the amount for 2 years.
He received only the amount P2,900 after the bank collected an advance interest of
P100. What was the rate of interest that the bank collected in advance? (Ans: 3.448%)

10. What will be the future worth of money after 24 months if the sum P34,000 is invested
today at simple interest rate of 2% per year? (Ans: P35,360)

COMPOUND INTEREST
1. How long will it take the money to double itself if invested at 5% compounded
annually? (Ans: 14.21 years)

2. What is the present worth of two P100 payment at the end of 3 rd year and 4th year?
i=8% (Ans: P152.88)

3. A firm borrows P2000 for 6 years at 8%. At the end of 6 years it renews the loan for
the amount due plus P2000 more for 2 years. What is the future worth at the end of 8
years? (Ans: P5506.55)

4. Find the equal annual payment to extinguish a debt of P120000 payable for 12 years
at 12% compounded annually. (Ans: P19372.42)

5. Find the accumulated amount of P5000 when deposited in the bank at the rate of 12%
compounded continuously for 5 years. (Ans: P9110.59)

6. A loan for P7,000 is to be paid in 7 years at the amount of P13,500. What is the
effective rate of money? (Ans: 9.84%)

7. The amount of P2,000 was deposited in a bank earning an interest of 10% per annum.
Determine the total amount at the end of 9 years if the principal and interest were not
withdrawn during this period. (Ans: P4715.8954)

8. Find the present worth of a future payment of P23,000 to be made in 3 years with an
interest of 35% compounded quarterly. (Ans: P8405.75)

9. What rate of interest compounded annually is the same as the rate of interest of 20%
compounded quarterly? (Ans: 1.227%)

10. Find the future worth if P3,700 is invested at 12% compounded bi-monthly for 7 years
and 6 months. (Ans: P9020.06)

ANNUITY
1. Engr. Eripol borrows P2M at 14% compounded annually and promised to repay the
loan in 10 equal annual payments. How much of original principal is still unpaid after
he has made the 5th payment? (Ans: P1,316,336.217)

2. What annuity is required over 12 years to equate with future amount of P20,000 if
i=6% annually? (Ans: P1185.54)

3. Find the present worth of perpetuity of P15,000 payable semi-annually if money is

worth 8% compounded quarterly. (Ans: P371,287.13)

4. How much money must Bogart invest today in order to withdraw P5,000 annually for 6
years if the interest rate is 13%? (Ans: P19987.75)

5. How much do ten P20,000 quarterly payments amount at present if the interest rate is
10% compounded quarterly? (Ans: P17504.13)

6. A policeman wants to retire in exactly one year and wants an account that will pay him
P30,000 a year for the next 10 years. Assuming a 5% effective interest rate, what is
the amount he would need to deposit now? (Ans: P231,652)

7. What amount should be deposited at 10% in order to withdraw P10,000 at the end of
each year for 5 years and leave nothing in the fund at the end? (Ans: P37,907.87)

8. What is the accumulated amount of 5 years annuity paying P6,000 at the end of each
year with interest at 15% compounded annually? (Ans: 40,454.29)

9. An engineer have a fund that consists 10 annual deposits of P2,500 each with interest
earned at the rate of 6% compounded annually. What is the principal in the fund at its
terminal date? (Ans: P32,951)

10. If money is worth 12% annually what annual payment is required to raise P400,000
after 13 years? (Ans: P14,270.88)

11. A business firm established an annual fund for the purchase of an equipment after 9
years which is estimated at P15,000. If i=20% find the annual deposits. (Ans:
P721.19)

12. Yesterday an unknown man borrowed money from a stranger to be paid in 8 equal
payments for 8 quarters if the interest rate is 8% compounded quarterly and the
quarterly payment is P5,000, how much did he borrow? (Ans: P36,627.4072)

13. What annuity is required over 6 years to equate with a future amount of P29,000 if
i=13% annually? (Ans: P3484.44)

14. Find the annual payment to eliminate a loan of P1,000 payable for 5 years at 50%
interest annually. (Ans: P575.83)

15. A man paid 10% down payment of P100,000 for a house and lot and agreed to pay
the 90% balance on monthly installment for 60 months at an interest rate of 10%
compounded monthly. Compute the amount of the monthly payment. (Ans:
P16,997.64)

16. What is the present worth of a 5 year annuity paying P5,000 at the end of each year
with interest at 5% compounded annually? (Ans: P21,647.38)

17. What is the future amount of a 10 year annuity paying P3,000 at the end of each year
with interest of 25% compounded annually? (Ans: P99,758.71)

18. A loan of P5,000 with 5% interest compounded semi-annually is to be extinguished by

semi-annual payment over the next 5 years. The first due in 6 months, determine the
semi-annual payment. (Ans: P571.29)

19. What is the present worth of a 500 pesos annuity starting at the end of the 3 rd year
and continuing to the end of the 4th year if the annual interest rate is 10%? (Ans:
P717.17)

20. Today a businessman borrowed money to be paid in 5 equal payments for 5 quarters.
If the interest rate is 10% compounded quarterly and the quarterly payment is P5,000
how much did he borrow? (Ans: P23,229.14)

DEPRECIATION
1. A laser gun has a selling price of P50, if its selling price is expected to decline at a rate
of 10% per annum what will be its selling price after 5 years? (Ans: P29.52)

2. A bulldozer costs P3,500 and an estimated life of 13 years and a salvage value of
P300. What is its book value after 10 years using straight line method? (Ans: P1038.5)

3. A construction firm bought a cement mixer for P6 million, freight and installation
charges amounted to 4% of the purchased price. If this equipment will be depreciated
over a period of 10 years with a salvage value of 8% determine the depreciation cost
during the 5th year using SYD. (Ans: P626,269.09)

4. Lex Corporation makes its a policy that for any new kryptonite purchased, the annual
depreciation costs should not exceed 10% 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. (Ans: 9 years)

5. A lady purchased a mobile phone for P10,000 and decided to keep it for 20 years if
the salvage value is zero at the end of 20 th year, what is the depreciation in the 3nd
year? Use SYD method. (Ans: P857.14)

6. An asset is purchased for P300,000. The salvage value in 25 years is P10,000. What
is the total depreciation in the first three years using straight line method? (Ans:
P34,800)

7. The bat mobile has an initial cost of P35,000 and a salvage value of P5,000 after 7
years. What is the book value after 4 years using straight line method? (Ans:
P17,857.16)

8. An asset is purchased for P9,000. Its estimated life is 10 years after which it will be
sold for P1,000. Find the book value during the first year if sum-of-years digit (SYD)
depreciation is used. (Ans: P7,454.54)

9. The cost value of the magic carpet is P100,000 and the cost of installation is P5,000. If
the salvage value is 8% of the cost of the magic carpet at the end of 3 years
determines the book value at the end of 2 nd year. Use straight line method. (Ans:
P40,333.33)

10. An asset is purchased for P35,000 and its estimated life is 9 years after which it will be
sold for P13,000. Find the depreciation for the first year using SYD method. (Ans:
P4,400)

ARITMETHIC AND GEOMETRIC GRADIENT

1.