. First Benchmark Publishing’s gross margin is 50%
54 %
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 %
▪ B. 20 %
▪ C. 19 %
▪ D. 18 %
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?
▪ A. 6.89 %
▪ B. 6.65 %
▪ C. 6.58 %
▪ D. 6.12 %
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.
▪ A. 28.33 %
▪ B. 29.17 %
▪ C. 30.12 %
▪ D. 30.78 %
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. 10 months
▪ B. 11 months
▪ C. 12 months
▪ D. 13 months
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?
▪ A. 23.5 %
▪ B. 24.7 %
▪ C. 25.0 %
▪ D. 25.8 %
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?
▪ A. 5,937.50
▪ B. 5,873.20
▪ C. 5,712.40
▪ D. 5,690.12
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.
▪ A. 12.19 %
▪ B. 12.03 %
▪ C. 11.
▪ 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?
▪ A. 3.67 %
▪ B. 4.00 %
▪ C. 4.15 %
▪ D. 4.25 %
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?
▪ A. 16.02 %
▪ B. 16.28 %
▪ C. 16.32 %
▪ D. 16.47 %
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.
▪ A. 11.50 %
▪ B. 11.75 %
▪ C. 11.95 %
▪ D. 12.32 %
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 %
▪ B. 12.34 %
▪ C. 12.67 %
▪ D. 12.87 %
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
▪ B. P18,900
▪ C. P19,000
▪ D. P19,100
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 “banker’s discount”.
▪ A. 13.15 %
▪ B. 13.32 %
▪ C. 13.46 %
▪ D. 13.73 %
14. The exact simple interest of P5,000 invested The interest has accrued is left for another eight
from June 21, 1995 to December 25, 1995 is P100. years. If the effective annual interest rate is 5%,
What is the rate of interest? what will be the withdrawal amount at the end of the
▪ A. 3.90 % 16th year?
▪ B. 3.92 % ▪ A. P693.12
▪ C. 3.95 % ▪ B. P700.12
▪ D. 3.98 % ▪ C. P702.15
15. What is the ordinary interest on P1,500.50 for ▪ D. P705.42
182 days at 5.2%? 24. Mandarin Bank advertises 9.5% account that
▪ A. P39.01 yields 9.84% annually. Find how often the interest is
▪ B. P39.82 compounded.
▪ C. P39.45 ▪ A. Monthly
▪ D. P39.99 ▪ B. Bimonthly
16. A loan for P50,000 is to be paid in 3 years at the ▪ C. Quarterly
amount of P65,000. What is the effective rate of ▪ D. Annually
money? 25. A student plans to deposit P1,500 in the bank
▪ A. 9.01 % now and another P3,000 for the next 2 years. If he
▪ B. 9.14 % plans to withdraw P5,000 three years from after his
▪ C. 9.31 % last deposit for the purpose of buying shoes, what
▪ D. 9.41 % will be the amount of money left in the bank after
17. What is the effective rate corresponding to 18% one year of his withdrawal? Effective annual interest
compounded daily? Take 1 year is equal to 360 days. rate is 10%.
▪ A. 19.61 % ▪ A. P1,549.64
▪ B. 19.44 % ▪ B. P1,459.64
▪ C. 19.31 % ▪ C. P1,345.98
▪ D. 19.72 % ▪ D. P1,945.64
18. What rate of interest compounded annually is the 26. You borrow P3,500.00 for one year from a friend
same as the rate of interest of 8% compounded at an interest rate of 1.5% per month instead of
quarterly? taking a loan from a bank at a rate of 18% per year.
How much lesser you will pay by borrowing the
▪ A. 8.07 % money from the bank?
▪ B. 8.12 %
▪ A. P 62.44
▪ C. 8.16 %
▪ B. P44.55
▪ D. 8.24 %
19. Which of these gives the lowest effective rate of
▪ C. P54.66
interest? ▪ D. P37.56
27. What is the present worth of two P 100
▪ A. 12.35 % compounded annually payments at the end of the third year and fourth
▪ B. 11.90 % compounded annually year? The annual interest rate is 8%.
▪ C. 12.20 % compounded annually ▪ A. P 150.56
▪ D. 11.60 % compounded annually ▪ B. P 152.88
20. An amount of P1,000 becomes P1,608.44 after 4
▪ C. P 153.89
years compounded bimonthly. Find the nominal
interest. ▪ D. P 151.09
28. A firm borrows P2,000 for 6 years at 8%. At the
▪ A. 11.89 % end of 6 years, it renews the loan for the amount
▪ B. 12.00 % due plus P2,000 more for 2 years at 8%. What is the
▪ C. 12.08 % lump sum due?
▪ D. 12.32 % ▪ A. P 3,260.34
21. How long will it take money to double itself if
▪ B. P 3,280.34
invested at 5% compounded annually?
▪ C. P 3,270.34
▪ A. 13.7 years ▪ D. P 3,250.34
▪ B. 14.7 years 29. In year zero, you invest P 10,000.00 in a 15%
▪ C. 14.2 years security for 5 years. During that time, the average
▪ D. 15.3 years annual inflation is 6%. How much in terms of year
22. By the condition of a will, the sum of P20,000 is zero pesos will be in the account at maturity?
left to a girl to be held in trust fund by her guardian ▪ A. P 15,030.03
until it amounts to P50,000. When will the girl
▪ B. P 20,113.57
receive the money if fund invested at 8%
compounded quarterly?
▪ C. P 18,289.05
▪ A. 11.23 years ▪ D. P 16,892.34
30. The institute of Electronics and Communications
▪ B. 11.46 years Engineers of the Philippines (IECEP) is planning to
▪ C. 11.57 years put up its own building. Two proposals being
▪ D. 11.87 years considered are:
23. A sum of P1,000 is invested now and left for
eight years, at which time the principal is withdrawn.
A. The construction of the building now to cost P 37. A young engineer borrowed P 10,000 at 12%
400,000 interest and paid P 2,000 per annum for the last 4
B. The construction of a smaller building now to cost years. What does he have to pay at the end of the
P300,000 and at the end of 5 years, an extension to fifth year in order to pay off his loan?
be added to cost P 200,000. ▪ A. P 6,999.39
By how much is proposal B more economical than ▪ B. P 6,292.93
proposal A if interest rate is 20% and depreciation to ▪ C. P 6,222.39
be neglected? ▪ D. P 6,922.93
▪ A. P 19,122.15 38. Miss Calledo deposited P 1,000, P 1,500 and P
▪ B. P 19,423.69 2,000 at the end of the 2nd year, 3rd year and 4th
▪ C. P 19,518.03 year, respectively in a savings account which earned
▪ D. P 19,624.49 10% per annum. How much is in the account at the
31. What is the present worth of a P500 annuity end of the 4th year?
starting at the end of the third year and continuing ▪ A. P 4,880.00
to the end of the fourth year, if the annual interest ▪ B. P 4,820.00
rate is 10 %? ▪ C. P 4,860.00
▪ A. P 727.17 ▪ D. P 4,840.00
▪ B. P 717.17 39. A P 1,000,000 issue of 3%, 15-year bond was
▪ C. P 714.71 sold at 95%. What is the rate of interest of this
▪ D. P 731.17 investment?
32. What annuity is required over 12 years to equate ▪ A. 3.0%
with a future amount of P 20,000? Assume i= 6% ▪ B. 3.4%
annually. ▪ C. 3.7%
▪ A. P 1,290.34 ▪ D. 4.0%
▪ B. P 1,185.54 40. A P 1, 000, 6% bond pays dividend semiannually
▪ C. P 1,107.34 and will be redeemed at 110% on June 21, 204. It is
▪ D. P 1,205.74 bought on June 21, 2001 to yield 4% interest. Find
33. A factory operator bought a diesel generator set the price of the bond.
for P 10,000.00 and agreed to pay the dealer ▪ A. P 1,122.70
uniform sum at the end of each year for 5 years at ▪ B. P 1,144.81
8% interest compounded annually, that the final ▪ C. P 1,133.78
payment will cancel the debt for principal and ▪ D. P 1,155.06
interest. What is the annual payment? 41. A VOM has a selling price of P 400. If its selling
▪ A. P 2,500.57 price is expected to decline at a rate of 10% per
▪ B. P 2,544.45 annum due to obsolescence, what will be its selling
▪ C. P 2,540.56 price after 5 years?
▪ D. P 2,504.57 ▪ A. P 222.67
34. What is the present worth of a year annuity ▪ B. P 212.90
paying P 3,000.00 at the end of each year, with ▪ C. P 236.20
interest at 8% compounded annually? ▪ D. P 231.56
▪ A. P 7,654.04 42. A machine costs of P 8,000 and an estimated life
▪ B. P 7,731.29 of 10 years with a salvage value of P 500. What is its
▪ C. P 7,420.89 book value after 8 years using straight line method?
▪ D. P 7,590.12 ▪ A. P 2,000.00
35. A man loans P 187,400 from a bank with interest ▪ B. P 2,100.00
at 5% compounded annually. He agrees to pay his ▪ C. P 2,200.00
obligations by paying 8 equal annual payments, the ▪ D. P 2,300.00
first being due at the end of 10 years. Find the 43. ABC Corporation makes it a policy that for any
annual payments. new equipment purchased, the annual depreciation
▪ A. P 43,600.10 cost should not exceed 20% of the first cost at any
▪ B. P 43,489.47 time with no salvage value. Determine the length of
▪ C. P 43,263.91 service life necessary if the depreciation used is the
▪ D. P 43,763.20 SYD method.
36. A person buys a piece of lot for P 100,000 ▪ A. 7 eyars
downpayment and 10 deferred semi-annual ▪ B. 8 years
payments of P 8,000 each, starting three years from ▪ C. 9 years
now. What is the present value of the investment if ▪ D. 10 years
the rate of interest is 12% compounded semi- 44. An asset is purchased for P 9,000.00. Its
annually? estimated economic life is 10 years after which it will
▪ A. P 142,999.08 be sold for P 1,000.00. Find the depreciation in the
▪ B. P 143,104.89 first three years using sum-of-years digit method
▪ C. P 142,189.67 ▪ A. P 3,279.27
▪ D. P 143,999.08 ▪ B. P 3,927.27
 ▪ C. P 3,729.27
▪ D. P 3,792.72
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%.
▪ A. P 9,358.41
▪ B. P 9,228.45
▪ C. P 9,250.00
▪ D. P 9,308.45
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.
▪ A. $ 5,000,000.00
▪ B. $ 5,010,000.00
▪ C. $ 5,025,000.00
▪ D. $ 5,050,000.00
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
▪ A. 1,033
▪ B. 1,037
▪ C. 1,043
▪ 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. 1.2 hours per unit
▪ C. 1.4 hours per unit
▪ D. 1.6 hours per unit
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
▪ B. 1,040 feet
▪ C. 1,100 feet
▪ D. 1,120 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?
▪ A. 2.590
▪ B. 2,632
▪ C. 2,712
▪ D. 2,890

1. 21 % 26. P54.66
2. 6.65 % 27. P 152.88
3. 29.17 % 28. P 3,260.34
4. 12 months 29. P 15,030.03
5. 25.0 % 30. P 19,624.49
6. 5,937.50 31. P 717.17
7. 10.29 % 32. P 1,185.54
8. 4.00 % 33. P 2,504.57
9. 16.28 % 34. P 7,731.29
10. 11.75 % 35. P 43,763.20
11. 12.07 % 36. P 143,999.08
12. P18,000 37. P 6,922.93
13. 13.73 % 38. P 4,860.00
14. 3.90 % 39. 3.0%
15. P39.45 40. P 1,144.81
16. 9.14 % 41. P 236.20
17. 19.72 % 42. P 2,000.00
18. 8.24 % 43. 9 years
19. 11.60 % compounded annually 44. P 3,927.27
20. 12.00 % 45. P 9,250.00
21. 14.2 years 46. $ 5,000,000.00
22. 11.57 years 47. 1,053
23. P705.42 48. 1.0 hour per unit
24. Quarterly 49. 1,000 feet
25. P1,549.64 50. 2,632
251. A price tag of P1200 is specified if paid within 60 days but ▪ B. 16.43%
offers a 3% discount for cash in 30 days. Find the rate of interest. ▪ C.18.37%
▪ A. 37.11% ▪ D. 10.32%
▪ B. 40.21% 255. Karen was granted a loan of P20,000 by her employer CPM
▪ C. 38.51% Industrial Fabricator and Construction Corporation with an
▪ D. 39.31% interest at 6% for 180days on the principal collected in advance.
252. It is the practice of almost all bank in the Philippines that The corporation would accept a promissory note for P20,000 non-
when they grant a loan, the interest for 1 year is automatically interest for 180days. If discounted at once, find the proceeds in
deducted from the principal amount upon release of money to a the note.
borrower. Let us therefore assume that you applied for a loan ▪ A. P18,800
with the bank and the P80000 was approved at an interest rate of ▪ B. P18,000
14% of which P11200 was deducted and you were given ac check ▪ C. P19,000
of P68800. Since you have to pay the amount of P80000 one year
▪ D. P18,400
after, what then will be the effective interest rate?
256. P4000 is borrowed for 75 days at 16% per annum simple
▪ A. 16.28% interest. How much will be due at the end of 75 days?
▪ B. 17.30% ▪ A. P4186.43
▪ C. 38.51% ▪ B. P4133.33
▪ D. 39.31% ▪ C. P5124.54
253. Mr. J. Dela Cruz borrowed money from the bank. He received
▪ D. P5625.43
from the bank P1,340.00 and promised to pay P1,500.00 at the
257. Mr. Bautista made a money market placement of P1,000,000
end of 9 months. Determine the simple interest rate and the
for 30 days at 7.5% per year. If withholding tax is 20%, what is the
corresponding discount rate or often referred to as the “Banker’s
net interest that Mr. Bautista will receive at the end of the
Discount”.
month?
▪ A. 15.92% ; 13.73%
▪ A. P3,000
▪ B. 12.95% ; 17.33%
▪ B. P6,000
▪ C.18.28% ; 13.12%
▪ C. P4,000
▪ D. 19.25% ; 13.33%
▪ D. P5,000
254. A man borrowed from the bank under a promissory note that
258. A bill for motorboat specifies the cost as P1,200 due at the
he signed in the amount of P25000.00 for a period of 1year. He
end of 100days but offers a 4% discount for cash in 30days. What
received only the amount of P21,915.00 after the bank collected
is the highest rate, simple interest at which the buyer can afford
the advance interest and an additional amount of P85.00 for
to borrow money in order to take advantage of the discount?
notarial and inspection fees. What was the rate of interest that
the bank collected in advance?
▪ A. 18.4%
▪ B. 20.9%
▪ A. 13.64%
 ▪ C. 19.6% ▪ A. P29.67
▪ D. 21.4% ▪ B. P76.92
259. In buying a computer disk, the buyer was offered the options ▪ C. P67.29
of paying P250 cash at the end of 30days or P270 at the end of ▪ D. P92.76
120days. At what rate is the buyer paying simple interest if he 267. The amount of P12800 in 4years at 5% compounded
agree to pay at the end of 120days? quarterly is _____.
▪ A. 32% ▪ A. P14,785.34
▪ B. 28% ▪ B. P16,311.26
▪ C.40% ▪ C. P15,614.59
▪ D. 25% ▪ D. P15,847.33
260. On March 1, 1996 Mr. Sarmiento obtains a loan of P1500 268. A man borrows money from a bank which uses a simple
from Mr. Avila and signs a note promising to pay the principal and discount rate of 14%. He signs a promissory note promising to pay
accumulated simple interest at the rate of 5% at the end of P500.00 per month at the end of 4th, 6th, and 7th month
120days. On May 15, 1996, Mr. Avila discounts the note at the respectively. Determine the amount of money that he received
bank whose discount rate is 6%. What does he receive? from the bank.
▪ A. P2,201.48 ▪ A. P1403.68
▪ B. P1,513.56 ▪ B. P1102.37
▪ C. P1,123.29 ▪ C. P1340.38
▪ D. P938.20 ▪ D. P1030.28
261. A deposit of P110,000 was made for 31days. The net interest 269. A nominal interest of 3% compounded continuously is given
after deducting 20% withholding tax is P890.36. Find the rate of on the account. What is the accumulated amount of P10,000 after
return annually. 10 years?
▪ A. 12.25 ▪ A. P13,610.10
▪ B. 12.75 ▪ B. P13,498.60
▪ C. 11.75 ▪ C. P13,500.10
▪ D. 11.95 ▪ D. P13,439.16
262. If you borrowed money from your friend with simple interest 270. BY the condition of a will, the sum of P2000 is left to a girl to
of 12%, find the present worth of P50,000 which is due at the end be held in trust fund by her guardian until it amount to
of 7months. P50000.00. When will the girl receive the money of the fund is
▪ A. P46,200 invested at 8% compounded quarterly?
▪ B. P46,729 ▪ A. 7.98 years
▪ C. P44,893 ▪ B. 11.57 years
▪ D. P45,789 ▪ C. 10.34 years
263. A man borrowed P2000 from a bank and promise to pay the ▪ D. 10.45 years
amount for 1year. He received only the amount of P1,920 after 271. A man expects to receive P25,000 in 8 years. How much is
the bank collected an advance interest of P80. What was the rate that worth now considering interest at 8% compounded
of discount and the rate of interest that the bank collected in quarterly?
advance?
▪ A. P13,859.12
▪ A. 4% ; 4.17%
▪ B. P13,675.23
▪ B. 4% ; 4.71%
▪ C. P13,958.33
▪ C. 3% ; 3.17%
▪ D. P13,265.83
▪ D. 3% ; 3.71% 272. P500,000 was deposited at an interest of 6% compounded
264. An engineer promised to pay P36,000 at the end of 90days. quarterly. Compute the compound interest after 4 years and 9
He was offered a 10% discount if he pays in 30 days. Find the rate months.
of interest.
▪ A. P163,475.37
▪ A. 64.6%
▪ B. P158,270.37
▪ B. 66.6%
▪ C. P178,362.37
▪ C. 65.6%
▪ D. P183,327.37
▪ D. 67.6% 273. If the nominal interest rate is 3%, how much is P5000 worth
265. A man is required to pay P200 at the end of 160 days or P190 in 10 years in a continuously compounded account?
at the end of 40 days. Determine the rate of interest.
▪ A. P5750
▪ A. 18.4%
▪ B. P7500
▪ B. 15.8%
▪ C. P6750
▪ C. 19.6%
▪ D. P6350
▪ D. 16.4% 274. P200,000 was deposited for a period of 4 years and 6 months
266. Compute the discount if P2000 is discounted for 6 months at and bears on interest of P85649.25. What is the rate of interest if
8% simple interest. it is compounded quarterly?
 ▪ A. 8% 283. A man wishes to have P40,000 in a certain fund at the end of
▪ B. 7% 8 years. How much should he invest in a fund that will pay 6%
compounded continuously?
▪ C. 6%
▪ D. 5%
▪ A. P24,751.34
275. How many years will P100,000 earn a compound interest of ▪ B. P28,864.36
P50,000 if the interest rate is 9% compounded quarterly? ▪ C. P36,421.44
▪ A. 3.25 years ▪ D. P30,468.42
▪ B. 5.86 years 284. If the effective annual interest rate is 4%, compute the
equivalent nominal annual interest compounded continuously.
▪ C. 4.55 years
▪ D. 2.11 years
▪ A. 3.92%
276. A certain amount was deposited 5 years and 9 months ago at ▪ B. 3.80%
an interest of 8% compounded quarterly. If the sum now is ▪ C. 4.10%
P315,379.85, how much was the amount deposited? ▪ D. 4.09%
▪ A. P200,000 285. What is the nominal rate of interest compounded
▪ B. P240,000 continuously for 10 years if the compound amount factor is equal
to 1.34986?
▪ C. P180,000
▪ D. P260,000
▪ A. 3%
For Problems 277-279: ▪ B. 5%
When compounded Bi-monthly, P15000 becomes P22,318.30 ▪ C. 4%
after 5years. ▪ D. 6%
277. What is the nominal rate of interest? 286. American Express Corp. charges 1.5% interest per month,
▪ A. 7% compounded continuously on the unpaid balance purchases made
▪ B. 9% on this credit card. Compute the effective rate of interest.
▪ C. 8% ▪ A. 19.72%
▪ D. 10% ▪ B. 21.20%
278. What is the equivalent rate if it is compounded quarterly? ▪ C. 20.25%
▪ A. 7.03% ▪ D. 19.90%
▪ B. 9.03% 287. If the nominal interest is 12% compounded continuously,
compute the effective annual rate if interest.
▪ C. 8.03%
▪ D. 10.03%
▪ A. 12.75%
279. What is the effective rate if it is compounded quarterly? ▪ B. 12.40%
▪ A. 7.28% ▪ C. 11.26%
▪ B. 9.28% ▪ D. 11.55%
288. Compute the difference in the future amount of P500
▪ C. 8.28%
compounded annually at nominal rate of 5% and if it is
▪ D. 10.28%
compounded continuously for 5 years at the same rate.
280. How will it take a money to double itself if invested at 5%
compounded annually?
▪ A. P3.87

▪ A. 12.2 years
▪ B. P5.48

▪ B. 14.2 years
▪ C. P4.21

▪ C. 13.2 years
▪ D. P6.25
289. If the effective rate is 24%, what nominal rate of interest is
▪ D. 15.2years
charged for a continuously compounded loan?
281. Compute the effective annual interest rate which is
equivalent to 5% nominal annual interest compounded ▪ A. 21.51%
continuously. ▪ B. 23.25%
▪ A. 5.13% ▪ C. 22.35%
▪ B. 5.26% ▪ D. 21.90%
290. What is the nominal rate of interest compounded
▪ C. 4.94%
continuously for 8 years if the present worth factor is equal to
▪ D. 4.90%
0.6187835?
282. Find the time required for a sum of money to triple itself at
5% per annum compounded continuously.
▪ A. 4%

▪ A. 21.97 years
▪ B. 6%

▪ B. 18.23 years
▪ C. 5%

▪ C. 25.34 years
▪ D. 7%
291. What is the difference of the amount 3 years from now for a
▪ D. 23.36 years
10% simple interest and 10% compound interest per year? (P5000
accumulated)
▪ A. P155
 ▪ B. same ▪ A. P422,462.64
▪ C. P100 ▪ B. P524,242.46
▪ D. P50 ▪ C. P507,233.24
292. Find the discount if P2,000 is discounted for 6 months at 8% ▪ D. P519,327.95
compounded quarterly.
▪ A. P76.92 251. 37.11%
▪ B. P77.66 252. 16.28%
▪ C. P80.00 253. 15.92% ; 13.73%
254. 13.64%
▪ D. P78.42
255. P18,800
293. If a sum of money triples in a certain period of time at a given
256. P4133.33
rate interest, compute the value of the single payment present
257. P5,000
worth factor.
258. 21.4%
▪ A. 0.333
259. 32%
▪ B. 0.292 260. P1,513.56
▪ C. 3.000 261. 11.75
▪ D. 1.962 262. P46,729
294. If the single payment amount factor for a period of 5 years is 263. 4% ; 4.17%
1.33822. What is the nearest value of the interest rate? 264. 66.6%
▪ A. 8% 265. 15.8%
▪ B. 5% 266. P76.92
▪ D. 7% 267. P15,614.59
268. P1403.68
▪ D. 6%
269. P13,498.60
295. If the single payment present worth factor for a period of 8
270. 11.57 years
years is equal to 0.58201, compute the nearest value of the rate
271. P13,265.83
of interest for that period.
272. P163,475.37
▪ A. 6%
273. P6750
▪ B. 5% 274. 8%
▪ C. 7% 275. 4.55 years
▪ D. 8% 276. P200,000
296. If money is worth 8% compounded quarterly, compute the 277. 8%
single payment amount factor for a period of 6 years. 278. 8.03%
▪ A. 1.60844 279. 8.28%
▪ B. 1.70241 280. 14.2 years
▪ C. 0.62172 281. 5.13%
282. 21.97 years
▪ D. 0.53162
283. P24,751.34
297. A sum of P1,000 is invested now and left for 8 years, at which
284. 3.92%
time the principal is withdrawn. The interest has an accrued left
285. 3%
for another 8 years. If the effective annual interest is 5%, what will
286. 19.72%
be the withdrawn amount at the end of the 16th year?
287. 12.75%
▪ A. P507.42
288. P3.87
▪ B. P750.42 289. 21.51%
▪ C. P705.42 290. 6%
▪ D. P425.07 291. P155
For problems 298 – 300: 292. P77.66
Compute the interest for an amount of P200,000 for a period of 8 293. 0.333
years. 294. 6%
298. If it was made at a simple interest rate of 16% . 295. 7%
▪ A. P274,000 296. 1.60844
▪ B. P256,000 297. P705.42
298. P256,000
▪ C. P265,000
299. P507,365.96
▪ D. P247,000
300. P519,327.95
299. If it was made at 16% compounded bi-monthly.
▪ A. P507,267.28
▪ B. P407,283.01
▪ C. P507,365.96
▪ D. P459,923.44
300. If it was made at 16% compounded continuously.
 310. An amount of P1000 becomes P1608.44 after 4
301. Find the value of x, (F/P, x, 6) if F/P compounded quarterly is years compounded bi-monthly. Find the nominal rate of interest,
equal to 1.612226. the effective rate of interest, and the equivalent rate of interest if
▪ A. 7% it is compounded quarterly.
▪ B. 5% ▪ A. 11% ; 12.623% ; 11.42%
▪ C. 8% ▪ B. 12% ; 11.06% ; 12.724%
▪ D. 6% ▪ C. 12% ; 12.616% ; 12.06%
302. Find the value of y, (P/F, 6%, y) if P/F compounded bi- ▪ D. 11% ; 11.664% ; 11.93%
monthly is equal to 0.787566. 311. How long would it take your money to double itself if it is
▪ A. 7 years invested at 6% simple interest, compounded semi-quarterly, and
▪ B. 5 years compounded continuously?
▪ C. 6 years ▪ A. 12.67 yrs ; 11.2 yrs ; 15.05 yrs
▪ D. 4 years ▪ B. 18.67 yrs ; 11.6 yrs ; 11.24 yrs
303. Find the rate of interest if compound amount factor ▪ C. 16.67 yrs ; 11.6 yrs ; 11.55 yrs
compounded bi-monthly for 5 years is equal to 1.487887. ▪ D. 17.67 yrs ; 10.2 yrs ; 11.45 yrs
▪ A. 7% For problems 312 – 314:
▪ B. 5% An amount of P50,000 was invested for 3 years.
312. Compute its interest at the end of 3 years if it is invested
▪ C. 8%
at 10% simple interest.
▪ D. 6%
304. Compute the nominal rate for a period of 6 years for an
▪ A. P16,550.00
effective rate of 8.33% if it is compounded continuously. ▪ B. P15,000.00
▪ A. 7% ▪ C. P17,492.94
▪ B. 5% ▪ D. P14,242.15
313. Compute for its compound interest if it is invested at 10%
▪ C. 8%
compounded annually.
▪ D. 6%
305. Compute the equivalent compound amount factor if it is
▪ A. P16,550.00
compounded continuously. ▪ B. P15,000.00
▪ A. 1.61607 ▪ C. P17,492.94
▪ B. 1.24532 ▪ D. P14,242.15
314. Compute its interest if it is invested at 10%
▪ C. 1.24282
compounded continuously.
▪ D. 0.24245
306. Compute the equivalent present worth factor if it is
▪ A. P16,550.00
compounded continuously. ▪ B. P15,000.00
▪ A. 1.249347 ▪ C. P17,492.94
▪ B. 1.243248 ▪ D. P14,242.15
For Problems 315 – 317:
▪ C. 1.214359
P200,000 was deposited for a period of 4 yrs. And 6 months and
▪ D. 0.616783
bears on interest of P85,659.25.
307. A man loan P2000 from the bank. How long would it take in
315. What is the nominal rate of interest if it is compounded
years for the amount of the loan and interest to equal P3280 if it
quarterly?
was made at 8% simple interest.
▪ A. 8.00%
▪ A. 7 years
▪ B. 7.00%
▪ B. 5 years
▪ C. 8.24%
▪ C. 8 years
▪ D. 7.96%
▪ D. 6 years
316. What is the actual rate of interest?
308. A man loan P2000 from the bank. How long would it take in
years if it was made at 8% compounded quarterly.
▪ A. 8.00%

▪ A. 5.25 years
▪ B. 7.00%

▪ B. 7.25 years
▪ C. 8.24%

▪ C. 6.25 years
▪ D. 7.96%
317. What is the equivalent nominal rate if it is compounded
▪ D. 8.25 years
semi-quarterly?
309. A man loan P2000 from the bank. How long would it take in
years if it was made at 8% compounded continuously. ▪ A. 8.00%

▪ A. 7.18 years
▪ B. 7.00%

▪ B. 5.18 years
▪ C. 8.24%

▪ C. 8.18 years
▪ D. 7.96%
318. What is the value of (F/P, 8%, 6) if it is compounded semi-
▪ D. 6.18 years
quarterly.
 ▪ A. 0.524273541 ▪ A. 6.23%
▪ B. 1.487886717 ▪ B. 8.00%
▪ C. 0.787566127 ▪ C. 5.92%
▪ D. 1.612226000 ▪ D. 9.78%
319. What is the value of (P/F, 6%, 4) if it is compounded bi- 328.) What is the actual interest rate of problem no. 327?
monthly. ▪ A. 7.24%
▪ A. 0.524273541 ▪ B. 7.92%
▪ B. 1.487886717 ▪ C. 8.24%
▪ C. 0.787566127 ▪ D. 8.87%
▪ D. 1.612226000 329.) What is the equivalent rate if problem no. 327
320. What is the single payment compound amount factor for 8% is compounded daily?
compounded bi-monthly for 5 years. ▪ A. 7.24%
▪ A. 0.524273541 ▪ B. 7.92%
▪ B. 1.487886717 ▪ C. 8.24%
▪ C. 0.787566127 ▪ D. 8.87%
▪ D. 1.612226000 For Problems 330 – 332:
For Problems 321 – 323: A businessman loaned P500,000 from a local bank that charges an
If money is invested at a nominal rate of interest of 8% for a interest rate of 12%.
period of 4 years. 330. How much is he going to pay at the end of 5 years if it was
321.) What is the effective rate if it is compounded continuously? made at 12% simple interest?
▪ A. 8.33% ▪ A. P800,000.00
▪ B. 9.33% ▪ B. P911,059.20
▪ C. 8.93% ▪ C. P823,243.09
▪ D. 9.93% ▪ D. P907,009.21
322.) What is the value of the compound amount factor if it is 331. How much is he going to pay at the end of 5 years if it was
compounded continuously? made at 12% compound semi-quarterly?
▪ A. 1.377128 ▪ A. P800,000.00
▪ B. 1.424231 ▪ B. P911,059.20
▪ C. 0.214212 ▪ C. P823,243.09
▪ D. 0.122416 ▪ D. P907,009.21
323. What is the value of the present worth factor if it is 332. How much is he going to pay at the end of 5 years if it was
compounded continuously? made at 12% compound continuously?
▪ A. 1. 272441 ▪ A. P800,000.00
▪ B. 0.272441 ▪ B. P911,059.20
▪ C. 1.726419 ▪ C. P823,243.09
▪ D. 0.726149 ▪ D. P907,009.21
324. If the single payment amount factor for a period of 5 years 333. P60,000 was deposited at 6% compounded quarterly, tax
is 1.33822, what is the nominal rate of interest? free for 9 years and 3 months. How much interest was earned at
▪ A. 6.00% the end of the period?
▪ B. 7.00% ▪ A. P43,214.24
▪ C. 6.92% ▪ B. P44,086.60
▪ D. 7.92% ▪ C. P43.242.24
325. What is the effective rate of interest if it is compounded ▪ D. P44,215.60
semi-annually of problem no. 324? 334. P100,000 was placed in a time deposit which earned
▪ A. 5.00% 9% compounded quarterly tax free. After how many years would
▪ B. 7.24% it be able to earn a total interest of P50,000?
▪ C. 6.92% ▪ A. 4.56 years
▪ D. 6.09% ▪ B. 3.45 years
326. What is the equivalent nominal rate if it is compounded ▪ C. 4.23 years
quarterly of problem no. 324? ▪ D. 3.64 years
▪ A. 6.12% 335. P200,000 was placed in a time deposit at x% compounded
▪ B. 4.24% quarterly and was free of taxes. After exactly 5 years, the total
interest earned was P120,000. What is the value of x?
▪ C. 5.43%
▪ D. 5.87%
▪ A. 9.5%
327. Money was invested at x% compounded quarterly. If it takes ▪ B. 6.35%
money to quadruple in 17.5 years, find the value of x. ▪ C. 8.21%
 ▪ D. 7.12% ▪ B. 14.94%
336. Which of these gives the lowest effective rate of interest? ▪ C. 14.36%
▪ A. 12.35% compounded annually ▪ D. 14.88%
▪ B. 12.2% compounded quarterly 345. The amount of P50,000 was deposited in a bank earning an
▪ C. 11.9% compounded semi-annually interest of 7.5% per annum. Determine the total amount at the
▪ D. 11.6% compounded monthly end of 5 years, if the principal and interest were not withdrawn
337. It takes 20.15 years to quadruple your money if it is invested during the period.
at x% compounded semi-annually. Find the value of x. ▪ A. P71,781.47
▪ A. 8% ▪ B. P70,374.90
▪ B. 7% ▪ C. P72,475.23
▪ C. 6% ▪ D. P78,536.34
▪ D. 5% 346. What is the effective rate corresponding to 18%
338. It takes 13.87 years to treble the money at the rate of compounded daily? Take 1 year is equal to 360 days.
x% compounded quarterly. Compute the value of x. ▪ A. 18.35%
▪ A. 5% ▪ B. 18.10%
▪ B. 7% ▪ C. 19.39%
▪ C. 6% ▪ D. 19.72%
▪ D. 8% 347. If P1,000 becomes P1,126.49 after 4 years when invested at a
339. Money was invested at x% compounded quarterly. If it takes certain nominal rate of interest compounded semi-annually,
the money into quadruple in 17.5 years, find the value of x. determine the nominal rate and the corresponding effective rate.
▪ A. 8% ▪ A. 3.00% and 3.02%
▪ B. 7% ▪ B. 2.30% and 2.76%
▪ C. 6% ▪ C. 4.29% and 4.32%
▪ D. 5% ▪ D. 3.97% and 3.95%
340. Fifteen years ago P1,000.00 was deposited in a bank account, 348. Convert 12% semi-annually to compounded quarterly.
and today it is worth P2.370.00. The bank pays interest semi- ▪ A. 19.23%
annually. What was the interest rate paid on this account? ▪ B. 14.67%
▪ A. 4.9% ▪ C. 23.56%
▪ B. 5.0% ▪ D. 11.83%
▪ C. 5.8% 349. What is the corresponding effective interest rate of 18%
▪ D. 3.8% compounded semi-quarterly?
341. You borrow P3,500.00 for one year from a friend at an ▪ A. 19.25%
interest rate of 1.5% per month instead of taking a loan from a ▪ B. 18.46%
bank at a rate of 18% per year. Compare how much money you ▪ C. 19.48%
will save or lose on the transaction. ▪ D. 18.95%
▪ A. pay P155 more if you borrowed from the bank 350.) If P5000 shall accumulate for 10 years at 8% compounded
▪ B. save P55 by borrowing from your friend quarterly, find the compounded interest at the end of 10 years.
▪ C. pay P85 more if you borrowed from the bank ▪ A. P6,005.30
▪ D. save P95 by borrowing from your friend ▪ B. P6,040.20
342. Find the present worth of a future payment of P1000,000 to ▪ C. P6,000.00
be made in 10 years with an interest of 12% compounded ▪ D. P6,010.20
quarterly.
▪ A. P30,444.44
▪ B. P30,655.68
▪ C. P33,000.00 301. 8%
▪ D. P30,546.01 302. 4 years
343. An initial savings deposit of P80,000 in a certain bank earns 303. 8%
6% interest per annum compounded monthly. If the earnings 304. 8%
from the deposit are subject to a 20% tax, what would the net 305. 1.61607
value of the deposit be after three quarters? 306. 0.616783
307. 8 years
▪ A. P95,324.95
308. 6.25 years
▪ B. P68743.24
309. 6.18 years
▪ C. P82938.28 310. 12% ; 12.616% ; 12.06%
▪ D. P56244.75 311. 16.67 yrs ; 11.6 yrs ; 11.55 yrs
344. The effective rate of interest of 14% compounded semi- 312. P15,000.00
annually is: 313. P16,550.00
▪ A. 14.49% 314. P17,492.94
315. 8.00%
316. 8.24%
317. 7.96%
318. 1.612226000
319. 0.787566127
320. 1.487886717
321. 8.33%
322. 1.377128
323. 0.726149
324. 6.00%
325. 6.09%
326. 5.87%
327. 8.00%
328. 8.24%
329. 7.92%
330. P800,000.00
331. P907,009.21
332. P911,059.20
333. P44,086.60
334. 4.56 years
335. 9.5%
336. 11.6% compounded monthly
337. 7%
338. 8%
339. 8%
340. 5.8%
341. save P55 by borrowing from your friend
342. P30,655.68
343. P82938.28
344. 14.49%
345. P71,781.47
346. 19.72%
347. 3.00% and 3.02%
348. 11.83%
349. 19.48%
350. P6,040.20
351. A couple borrowed P4,000 from a lending company for 6 ▪ C. P15,030.00
years at 12%. At the end of 6 years, it renews the loan for the ▪ D. P16,653.00
amount due plus P4,000 more for 3 years at 12%. What is 359. A machine has been purchased and installed at a total cost of
thelump sum due? P18,000.00. The machine will be retired at the end of 5 years, at
▪ A. P14,842.40 which time it is expected to have a scrap value of P2,000.00 based
▪ B. P12,316.40 on current prices. The machine will then be replaced with an exact
▪ C. P16,712.03 duplicate. The company plans to establish a reserve fund to
▪ D. P15,382.60 accumulate the capital needed to replace the machine. If
352. How long (in years) will it take the money to quadruple if it an average annual rate of inflation of 3% is anticipated, how
earns 7% compounded semi-annually? much capital must be accumulated?
▪ A. 26.30 years ▪ A. P15,030.00
▪ B. 33.15 years ▪ B. P12,382.00
▪ C. 40.30 years ▪ C. P18,548.39
▪ D. 20.15 years ▪ D. P15,386.00
153. P200,000 was deposited on Jan. 1,1988 at an interest rate of 360. If the inflation rate is 6%, cost of money is 10%, what
24% compounded semi-annually. How much would the sum be interest rate will take care of inflation and the cost of money?
on Jan. 1, 1993? ▪ A. 16.6%
▪ A. P421,170 ▪ B. 17.7%
▪ B. P401,170 ▪ C. 15.5%
▪ C. P521,170 ▪ D. 14.4%
▪ D. P621,170 361. A man bought a government bond which cost P1000 and will
354. If P500,000 is deposited at a rate of 11.25% compounded pay P50 interest each year for 20 years. The bond will mature at
monthly, determine the compounded interest after 7 years and 9 the end of 20 years and he will receive the original P1000. If there
months. is 2% annual inflation during this period, what rate of return will
the investor receive after considering the effect of inflation?
▪ A. P690,849
▪ B. P680,686
▪ A. 2.94%

▪ C. P670,258
▪ B. 4.25%

▪ D. P660,592
▪ C. 3.16%
355.) P200,000 was deposited at an interest rate of ▪ D. 5.16%
24% compounded semi-annually. After how many years will the 362.) The inflated present worth of P2000 in two years is equal to
sum be P621,170? P1471.07. What is the rate of inflation if the interest rate is equal
to 10%?
▪ A. 4 years
▪ B. 5 years
▪ A. 6%

▪ C. 3 years
▪ B. 7%

▪ D. 6 years
▪ C. 5%
356. A bank is advertising 9.5% accounts that yields 9.84% ▪ D. 4%
annually. How often is the interest compounded? 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
▪ A. monthly
inflation?
▪ B. quarterly
▪ A. 6.62%
▪ C. bi-monthly
▪ B. 7.67%
▪ D. daily
357. A marketing company established a program to replace the
▪ C. 5.66%
cars of its sales representatives at the end of every 5 years. If the ▪ D. 4.64%
present price of the approved type of car is P520,000.00 with a 364. An engineer bought an equipment for P500,000. Other
resale value at the end of 5 years of 60% its present value, how expenses including installations amounted to P30,000. At the end
much money must the company accumulate for 5 years of its estimated useful life of 10 years, the salvage value will be
if inflation annually is 10%. Release value will also appreciate at 10% of the first cost. Using straight line method of depreciation,
10% yearly. what is the book value after 5 years?
▪ A. P120,289.51 ▪ A. P291,500
▪ B. P110,297.27 ▪ B. P242,241
▪ C. P129,382.38 ▪ C. P282,242
▪ D. P122,265.69 ▪ D. P214,242
358. In year zero, you invest P10,000.00 in a 15% security for 5 365. A small machine costing P80,000 has a salvage value of x at
years. During that time, the average annual inflation is 6%. How the end of its life of 5 years. The book value at the end of the 4th
much, in terms of year zero will be in the account atmaturity? year is P22,400. What is the value of x using the straight line
method depreciation?
▪ A. P15,386.00
▪ B. P13,382.00
▪ A. P6000
 ▪ B. P8000 The first cost of a machine is P1,800,000 with a salvage value of
▪ C. P7000 P300,000 at the end of its life of 5 years. Determine the total
depreciation after 3 years.
▪ D. P9000
372. Using Straight Line Method
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 ▪ A. P800,000
P30,833.33. Using a straight line method of depreciation,what is ▪ B. P900,000
the first cost of the machine? ▪ C. P600,000
▪ A. P125,500 ▪ D. P700,000
▪ B. P125,000 373. Using Sum of Years Digit Method
▪ C. P135,500 ▪ A. P1,150,000
▪ D. P135,000 ▪ B. P1,300,000
367. A manufacturing plant was built at a cost of P5M and is ▪ C. P1,200,000
estimated to have a life of 20 years with a salvage value of P1M. A ▪ D. P1,350,600
certain equipment worth P570,000 was installed at a cost of 374. Using Constant Percentage Method
P80,000 is expected to operate economically for 15 years with ▪ A. P1,355,024.24
a salvage value of P50,000. Determine the book value of the
▪ B. P1,246,422.53
plant and equipment after 10 years, use straight line depreciation
▪ C. P1,185,769.76
method.
▪ D. P1,432,624.84
▪ A. P3,250,000
375. An asset is purchased for P9,000.00. Its estimated economic
▪ B. P4,250,000
life is 10 years after which it will be sold for P1,000.00. Find
▪ C. P3,750,000 the depreciation in the first three years using straight line
▪ D. P4,500,000 method.
368. A printing equipment costs P73,500 has a life expectancy of 8 ▪ A. P2,500
years and has a salvage value of P3,500 at the end of its life. The
▪ B. P3,000
book value at the end of x years is equal to P38,500.
▪ C. P2,400
Using straight line method of depreciation, solve for the value of
x. ▪ D. P2,000
376. The purchase of a motor for P6000 and a generator for
▪ A. 5 years
P4000 will allow the company to produce its own energy. The
▪ B. 6 years
configuration can be assembled for P500. The service will operate
▪ C. 4 years for 1600 hours per year for 10 years. The maintenance cost is
▪ D. 3 years P300 per year, and cost to operate is P0.85 per hour for fuel and
369. The cost of the printing equipment is P500,000 and the cost related cost. Using straight line depreciation, what is the annual
of handling and installation is P30,000. If the book value of the cost for the operation? There is a P400 salvage value for the
equipment at the end of the 3rd year is P242,000 and the life of system at the end of 10 year.
the equipment is assumed to be 5 years, determine the salvage ▪ A. P2,710
value of this equipment at the end of 5 years.
▪ B. P2,630
▪ A. P50,000
▪ C. P2,480
▪ B. P53,000
▪ D. P2,670
▪ C. P60,000 377. A machine has an initial cost of P50,00.00 and a salvage value
▪ D. P64,000 of P10,000.00 after 10 years. What is the straight line method
370. An engineer bought an equipment for P500,000. He spent an depreciation rate as a percentage of the initial cost?
additional amount of P30,000 for installation and other expenses. ▪ A. 10%
The salvage value is 10% of the first cost. If the book value at the
▪ B. 12%
end of 5 years will be P291,500 using straight line method of
▪ C. 8%
depreciation, compute the useful life of the equipment in years.
▪ D. 9%
▪ A. 10 years
378. A machine has an initial cost of P50,00.00 and a salvage value
▪ B. 6 years
of P10,000.00 after 10 years. What is the book value after 5
▪ C. 8 years years using straight line method depreciation rate?
▪ D. 15 years ▪ A. P35,000
371. The cost of equipment is P500,000 and the cost of
▪ B. P15,500
installation is P30,000. If the salvage value is 10% of the cost of
▪ C. P25,000
equipment at the end of 5 years, determine the book value at the
end of the fourth year. Use straight line method. ▪ D. P30,000
379. A machine has a first of P80,000 and a salvage of P2,000 at
▪ A. P155,000
the end of its life of 10 years. Find the book value at the end of
▪ B. P146,000
the 6th year using straight line method of depreciation.
▪ C. P140,000
▪ A. P33,200
▪ D. P132,600
▪ B. P34,300
For Problems 172-174:
 ▪ C. P35,400 equipment at the 4th year is equal to P2197.22, compute
▪ D. P32,900 the salvage value x using the sum of years digit method.
380. An asset is purchased for P90,000.00. Its estimated life is 10 ▪ A. P594
years after which it will be sold for P1,000.00. Find the book ▪ B. P350
value during the first year if Sum of the Years Digits(SYD) ▪ C. P430
depreciation is used. ▪ D. P290
▪ A. P7,545.45 387. ABC Corporation makes it policy that for every new
▪ B. P5,245.92 equipment purchased, the annual depreciation should not exceed
▪ C. P2,980.24 20% of the first cost at any time without salvage value. Determine
▪ D. P6,259.98 the length of service if the depreciation used is the SYD Method.
381. A telephone company purchased a microwave radio ▪ A. 9 years
equipment for P6M. Freight and installation charges amounted to ▪ B. 12 years
3% of the purchased price. If the equipment shall be depreciated ▪ C. 10 years
over a period of 8 years with a salvage value of 5%, determine the ▪ D. 19 years
depreciation charge during the 5th year using the Sum of Year 388. A machine having a certain first cost has a life of 10 years and
Digit Method. a salvage value of 6.633% of the first cost at the end of 10 years. If
▪ A. P756,632.78 it has a book value of P58,914 at the end of the 6thyear, how
▪ B. P652,333.33 much is the first cost of the machine if the constant percentage
▪ C. P957,902.56 of declining value is used in the computation for its
▪ D. P845, 935.76 depreciation.(Matheson’s Method)
382. A consortium of international communications companies ▪ A. P600,000
contracted for the purchase and installation of a fiber optic cable ▪ B. P100,000
linking two major Asian cities at a total cost of P960M. This ▪ C. P300,000
amount includes freight and installation charges at 10% of the ▪ D. P900,000
above total contract price. If the cable depreciated over a period 389. A machine costing P720,000 is estimated to have a life of 10
of 15 years with zero salvage value, what is thedepreciation years. If the annual rate of depreciation is 25%, determine
charge during the 8th year using the sum of year digits method? the total depreciation using a constant percentage of the
▪ A. P64 M declining balance method.
▪ B. P80 M ▪ A. P679,454.27
▪ C. P23 M ▪ B. P532,825.73
▪ D. P76 M ▪ C. P432,725.45
383. A machine cost P7,350 has a life of 8 years and has a salvage ▪ D. P764,243.33
value of P350 at the end of 8 years. Determine its book value at 390. An earth moving equipment that cost P90,000 will have an
the end of 4 years using sum years digit method. estimated salvage value of P18,000 at the end of 8 years. Using
▪ A. P3,476.90 double-declining balance method, compute the book value and
▪ B. P6,543.21 the total depreciation at the end of the 5th year.
▪ C. P2,294.44 ▪ A. P21,357.42 ; P68,642.58
▪ D. P5,455.01 ▪ B. P24,362.48 ; P65,637.52
384. A certain equipment costs P7,000 has an economic life of n ▪ C. P15,830.34 ; P74,169.66
years and a salvage value P350 at the end of n years. If the book ▪ D. P19,442.78 ; P70,557.22
value at the end of 4 years is equal to P2197.22, compute for 391. A certain office equipment has a first cost of P20,000 and has
the economic life of the equipment using the sum of years digit a salvage value of P1,000 at the end of 10 years. Determine
method. the depreciation at the end of the 6th year using Sinking fund
▪ A. 10 years method at 3% interest.
▪ B. 8 years ▪ A. P10,720
▪ C. 16 years ▪ B. P11,680
▪ D. 11 years ▪ C. P12,420
385. A company purchased an asset for P10000 and plans to keep ▪ D. P9,840
it for 20 years. If the salvage value is zero at the end of the 20th 392. An equipment which cost P200,000 has a useful life of 8
year, what is the depreciation in the third year? Use sum of years years with a salvage value of P25,000 at the end of its useful life. If
digit method. the depreciation at the first year is P21,875, what method is used
▪ A. P1000 in the calculation of depreciation?
▪ B. P938 ▪ A. Straight Line
▪ C. P857 ▪ B. Declining Balance
▪ D. P747 ▪ C. Sinking Fund
386. An equipment costs P7000 and has a life of 8 years and ▪ D. Sum of Years Digit
salvage value of x after 8 years. If the book value of the
393. An equipment costs P8,000 has an economic life of 8 years ▪ D. P16,000
and salvage value of P400 at the end of 8 years. The first year 400. A lathe machine costs P300,000 brand new with a salvage
depreciation amounts to P1,688.89. What method is used in the value of x pesos. The machine is expected to last for 28500 hours
calculation of the depreciation? in a period of 5 years. In the first year of service it was used for
▪ A. Straight Line 8000 hours. If the book value at the end of the first year is
▪ B. Declining Balance P220,000, compute for the salvage value x in pesos.
▪ C. Sinking Fund ▪ A. P15,000
▪ D. Sum of Years Digit ▪ B. P12,000
394. The original cost of a certain machine is P150,000 and has an ▪ C. P18,000
economic life of 8 years with a salvage value of P9,000 at that ▪ D. P20,000
time. If the depreciation of the first year is equal to P44,475, what
method is used in the calculation of the depreciation? 351. P16,712.03
▪ A. Straight Line 352. 20.15 years
▪ B. Declining Balance 353. P621,170
▪ C. Sinking Fund 354. P690,849
355. 5 years
▪ D. Sum of Years Digit
356. quarterly
395. A machine has a first cost of P140,000 and a life of 8 years
357. P120,289.51
with a salvage value of P10,000 at the end of its useful life. If the
358. P15,030.00
depreciation at the first year amounts to P35,000, what method is
359. P18,548.39
used in the calculation of depreciation?
360. 16.6%
▪ A. Double Declining Balance
361. 2.94%
▪ B. Straight Line 362. 6%
▪ C. Declining Balance 363. 5.66%
▪ D. Sum of Years Digit 364. P291,500
396. A hydraulic machine cost P180,000 and has a salvage value of 365. P8000
P15,000 at the end of its useful life which is 12 years. If the 366. P125,000
depreciation at the first year is P9,780.71, what method is used in 367. P3,250,000
computing the depreciation. Assume money is worth 6% annually. 368. 4 years
▪ A. Straight Line 369. P50,000
▪ B. Declining Balance 370. 10 years
▪ C. Sinking Fund 371. P146,000
372. P900,000
▪ D. Sum of Years Digit
373. P1,200,000
397. An equipment costs P480,000 and has a salvage value of 10%
374. P1,185,769.76
of its cost at the end of its economic life of 35,000 operating
375. P2,400
hours. In the first year, it was used for 4,000 hours. Determine
376. P2,670
its book value at the end of the first year.
377. 8%
▪ A. P430,629.00
378. P30,000
▪ B. P418,360.00 379. P33,200
▪ C. P380,420.00 380. P7,545.45
▪ D. P376,420.00 381. P652,333.33
398. An equipment costs P480,000 and has a salvage value of 10% 382. P64 M
of its cost at the end of its economic life of 36,000 operating hours 383. P2,294.44
in a period of 5 years. In the first year of service, it was used for 384. 8 years
12,000 hours. If at the end of the 2nd year it was used for 15,000 385. P857
hours, find the depreciation at the second year. 386. P350
▪ A. P180,000 387. 19 years
▪ B. P190,000 388. P300,000
▪ C. P160,000 389. P679,454.27
390. P21,357.42 ; P68,642.58
▪ D. P150,000
391. P12,420
399. A certain machine cost P40,000 and has a life of 4 years and a
392. Straight Line
salvage value of P5000. The production output of this machine in
393. Sum of Years Digit
units per year is 1000 units for the first year, 2000 units for the
394. Declining Balance
second year, 3000 units for the third year, and 4000 units for the
395. Double Declining Balance
fourth year. If the units produced are in uniform quality, what is
396. Sinking Fund
the depreciation charge at the end of the fourth year.
397. P430,629.00
▪ A. P14,000
398. P180,000
▪ B. P15,000 399. P14,000
▪ C. P13,000
400. P15,000