1. First Benchmark Publishing’s gross margin is 50% of B. 12.

03 %
sales. The operating costs of the publishing are C. 11.54 %
estimated at 15% of sales. If the company is within the D. 10.29 %
40% tax bracket, determine the percent of sales is their A college freshman borrowed P2,000 from a bank
profit after taxes? for his tuition fee and promised to pay the amount for one year.
A. 21 % He received only the amount of P1,920 after the bank
B. 20 % collected the advance interest of P80.00. What was the rate of
C. 19 % discount?
D. 18 % A. 3.67 %
2. A farmer selling eggs at 50 pesos a dozen gains 20%. If B. 4.00 %
he sells the eggs at the same price after the costs of C. 4.15 %
the eggs rises by 12.5%, how much will be his new gain D. 4.25 %
in percent?
A. 6.89 % 8. It is the practice of almost all banks in the Philippines
B. 6.65 % that when they grant a loan, the interest for one year is
C. 6.58 % automatically deducted from the principal amount upon
D. 6.12 % release of money to a borrower. Let us therefore assume
3. A feasibility study shows that a fixed capital investment that you applied for a loan with a bank and the P80,000
of P10,000,000 is required for a proposed construction was approved at an interest rate of 14% of which
firm and an estimated working capital of P2,000,000. P11,200 was deducted and you were given a check of
Annual depreciation is estimated to be10% of the fixed P68,800. Since you have to pay the amount of P80,000
capital investment. Determine the rate of return on the one year after, what then will be the effective interest
total investment if the annual profit is P3,500,000. rate?
A. 28.33 % A. 16.02 %
B. 29.17 % B. 16.28 %
C. 30.12 % C. 16.32 %
D. 30.78 % . 16.47 %
4. The monthly demand for ice cans being
manufactured by Mr. Camus is 3200 pieces. With a 9. A man invested P110,000 for 31 days. The net
manual operated guillotine, the unit cutting cost is interest after deducting 20% withholding tax is
P25.00. An electrically operated hydraulic guillotine P890.36. Find the rate of return annually.
was offered to Mr. Camus at a price of P275,000.00 A. 11.50 %
and which cuts by 30% the unit cutting cost. B. 11.75 %
Disregarding the cost of money, how many months C. 11.95 %
will Mr. Camus be able to recover the cost of the D. 12.32 %
machine if he decides to buy now?
A. 10 months 10. A investor wishes to earn 7% on his capital after
B. 11 months payment of taxes. If the income from an available
C. 12 months investment will be taxed at an average rate of 42%,
D. 13 months what minimum rate of return, before payment of
5. Engr. Trinidad loans from a loan firm an amount of taxes, must the investment offer to be justified?
P100,000 with a rate of simple interest of 20% but the A. 12.07 %
interest was deducted from the loan at the time the B. 12.34 %
money was borrowed. If at the end of one year, she has C. 12.67 %
to pay the full amount of P100,000, what is the actual D. 12.87 %
rate of interest? A. 23.5 %
B. 24.7 % 11. Mr. Jun Ramos was granted a loan of P20,000 by his
C. 25.0 % employer Excel First Review and Training Center, Inc. with
D. 25.8 % an interest of 6% for 180 days on the principal collected
6. A loan of P5,000 is made for a period of 15 months, at a in advance. The corporation would accept a promissory
simple interest rate of 15%, what future amount is due at note for P20,000 non-interest for 180 days. If discounted
the end of the loan period? at once, find the proceeds of the note.
A. 5,937.50 A. P18,000
B. 5,873.20 B. P18,900
C. 5,712.40 C. P19,000
D. 5,690.12 D. P19,100
7. Mr. Bacani borrowed money from the bank. He received
from the bank P1,842 and promised to repay P2,000 at 12. Miss Evilla borrowed money from a bank. She receives
the end of 10 months. Determine the rate of simple from the bank P1,340.00 and promised to pay
interest. P1,500.00 at the end of 9 months. Determine the
A. 12.19 % corresponding discount rate or often referred to as
 the “banker’s discount”. B. 14.7 years
A. 13.15 % C. 14.2 years
B. 13.32 % D. 15.3 years
C. 13.46 %
D. 13.73 % 20. 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
13. The exact simple interest of P5,000 invested from June it amounts to P50,000. When will the girl receive the
21, 1995 to December 25, 1995 is P100. What is the money if fund invested at 8% compounded quarterly?
rate of interest? A. 11.23 years
A. 3.90 % B. 11.46 years
B. 3.92 % C. 11.57 years
C. 3.95 % D. 11.87 years
D. 3.98 %
What is the ordinary interest on P1,500.50 for 182 days at 21. A sum of P1,000 is invested now and left for
eight years, at which time the principal is
5.2%?
withdrawn. The interest has accrued is left for
A. P39.01 another eight years. If the effective annual
B. P39.82 interest rate is 5%, what will be the withdrawal
C. P39.45 amount at the end of the 16th year?
D. P39.99 A. P693.12
B. P700.12
14. A loan for P50,000 is to be paid in 3 years at the amount C. P702.15
of P65,000. What is the effective rate of money?
D. P705.42
A. 9.01 %
22. Mandarin Bank advertises 9.5% account that yields
B. 9.14 % 9.84% annually. Find how often the interest is
C. 9.31 % compounded.
D. 9.41 % A. Monthly
B. Bimonthly
15. What is the effective rate corresponding to 18% C. Quarterly
compounded daily? Take 1 year is equal to 360 days.
D. Annually
A. 19.61 %
B. 19.44 % 23. A student plans to deposit P1,500 in the bank now and
C. 19.31 % another P3,000 for the next 2 years. If he plans to
D. 19.72 % withdraw P5,000 three years from after his last deposit
for the purpose of buying shoes, what will be the amount
16. What rate of interest compounded of money left in the bank after one year of his
annually is the same as the rate of interest withdrawal? Effective annual interest rate is 10%.
of 8% compounded quarterly? A. P1,549.64
A. 8.07 % B. P1,459.64
B. 8.12 % C. P1,345.98
C. 8.16 % D. P1,945.64
D. 8.24 %
24. You borrow P3,500.00 for one year from a friend at an
17. Which of these gives the lowest effective rate of interest? interest rate of 1.5% per month instead of taking a
A. 12.35 % compounded annually loan from a bank at a rate of 18% per year. How much
B. 11.90 % compounded annually lesser you will pay by borrowing the money from the
bank?
C. 12.20 % compounded annually
A. P 62.44
D. 11.60 % compounded annually
B. P44.55
18. An amount of P1,000 becomes P1,608.44 after C. P54.66
4 years compounded bimonthly. Find the D. P37.56
nominal interest.
A. 11.89 % 25. What is the present worth of two P 100 payments at
B. 12.00 % the end of the third year and fourth year? The annual
interest rate is 8%.
C. 12.08 %
A. P 150.56
D. 12.32 %
B. P 152.88
19. How long will it take money to double itself if invested at C. P 153.89
D. P 151.09
5% compounded annually?
A. 13.7 years
 26. A firm borrows P2,000 for 6 years at 8%. At the B. P 7,731.29
end of 6 years, it renews the loan for the C. P 7,420.89
amount due plus P2,000 more for 2 years at D. P 7,590.12
8%. What is the lump sum due?
A. P 3,260.34 32. A man loans P 187,400 from a bank with interest at 5%
B. P 3,280.34 compounded annually. He agrees to pay his obligations
C. P 3,270.34 by paying 8 equal annual payments, the first being due
D. P 3,250.34 at the end of 10 years. Find the annual payments.
A. P 43,600.10
27. In year zero, you invest P 10,000.00 in a 15% security for B. P 43,489.47
5 years. During that time, the average annual inflation is C. P 43,263.91
6%. How much in terms of year zero pesos will be in the
D. P 43,763.20
account at maturity? A. P 15,030.03
B. P 20,113.57
33. A person buys a piece of lot for P 100,000 downpayment
C. P 18,289.05 and 10 deferred semi-annual payments of P 8,000 each,
D. P 16,892.34 starting three years from now. What is the present value
of the investment if the rate of interest is 12%
28. The institute of Electronics and Communications compounded semi-annually?
Engineers of the Philippines (IECEP) is planning to put up A. P 142,999.08
its own building. Two proposals being considered are:
B. P 143,104.89
A. The construction of the building now to cost P 400,000 C. P 142,189.67
B. The construction of a smaller building now to D. P 143,999.08
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
34. A young engineer borrowed P 10,000 at 12% interest
and paid P 2,000 per annum for the last 4 years. What
than proposal A if interest rate is 20% and
does he have to pay at the end of the fifth year in order
depreciation to be neglected?
to pay off his loan?
A. P 19,122.15
A. P 6,999.39
B. P 19,423.69
B. P 6,292.93
C. P 19,518.03
C. P 6,222.39
D. P 19,624.49
D. P 6,922.93
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 %?
35. Miss Calledo deposited P 1,000, P 1,500 and P
A. P 727.17 2,000 at the end of the 2nd year, 3rd year and 4th
B. P 717.17 year, respectively in a savings account which
earned 10% per annum. How much is in the
C. P 714.71
D. P 731.17 account at the end of the 4th year?
A. P 4,880.00
29. What annuity is required over 12 years to equate with B. P 4,820.00
a future amount of P 20,000? Assume i= 6% annually. C. P 4,860.00
A. P 1,290.34 D. P 4,840.00
B. P 1,185.54 A P 1,000,000 issue of 3%, 15-year bond was sold at 95%.
C. P 1,107.34 What is the rate of interest of this investment?
D. P 1,205.74 A. 3.0%
B. 3.4%
30. A factory operator bought a diesel generator set for P C. 3.7%
10,000.00 and agreed to pay the dealer uniform sum D. 4.0%
at the end of each year for 5 years at 8% interest
compounded annually, that the final payment will
36. A P 1, 000, 6% bond pays dividend semiannually and will
cancel the debt for principal and interest. What is the
be redeemed at 110% on June 21, 204. It is bought on
annual payment?
June 21, 2001 to yield 4% interest. Find the price of the
A. P 2,500.57 bond.
B. P 2,544.45 A. P 1,122.70
C. P 2,540.56 B. P 1,144.81
D. P 2,504.57 C. P 1,133.78
D. P 1,155.06
31. What is the present worth of a year annuity paying
P 3,000.00 at the end of each year, with interest at
37. A VOM has a selling price of P 400. If its selling price is
8% compounded annually?
expected to decline at a rate of 10% per annum due to
A. P 7,654.04 obsolescence, what will be its selling price after 5
 years? C. 1,043
A. P 222.67 D. 1,053
B. P 212.90
C. P 236.20 43. A manufacturing firm maintains one product assembly
D. P 231.56 line to produce signal generators. Weekly demand for the
generators is 35 units. The line operates for 7 hours per
38. A machine costs of P 8,000 and an estimated life of 10 day, 5 days per week. What is the maximum production
years with a salvage value of P 500. What is its book time per unit in hours required of the line to meet the
value after 8 years using straight line method? demand?
A. P 2,000.00 A. 1.0 hour per unit
B. P 2,100.00 B. 1.2 hours per unit
C. P 2,200.00 C. 1.4 hours per unit
D. 1.6 hours per unit
D. P 2,300.00

39. ABC Corporation makes it a policy that for any new 44. A telephone switchboard 100 pair cable can be made up
with either enameled wire or tinned wire. There will be
equipment purchased, the annual depreciation
400 soldered connections. The cost of soldering a
cost should not exceed 20% of the first cost at any
connection on the enameled wire will be P 1.65 on the
time with no salvage value. Determine the length
tinned wire, it will be P 1.15. A 100- pair cable made up
of service life necessary if the depreciation used is
with enameled wire cost P 0.55 per linear foot and those
the SYD method.
made up of tinned wire cost P 0.75 per linear foot.
A. 7 eyars
Determine the length of cable run in feet so that the cost
B. 8 years of each installation would be the same.
C. 9 years A. 1,000 feet
D. 10 years
B. 1,040 feet
C. 1,100 feet
40. An asset is purchased for P 9,000.00. Its estimated
D. 1,120 feet
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 45. A leading shoe manufacturer produces a pair of Lebron
James signature shoes at a labor cost of P 900.00 a pair
A. P 3,279.27
and a material cost of P 800.00 a pair. The fixed charges
B. P 3,927.27
on the business are P 5,000,000 a month and the
C. P 3,729.27 variable costs are P 400.00 a pair. Royalty to Lebron
D. P 3,792.72 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
41. Shell Philippines, a multinational company, has a total month for the manufacturer to break-even?
gross income for a particular year of P 50,000,000. The A. 2.590
taxable income after taking all deductions except for B. 2,632
depletion is P 18,500,000. What is the allowable C. 2,712
depletion allowance for that particular year? Take D. 2,890
percentage of gross income for oil as 22%.
A. P 9,358.41 Under ordinary simple
B. P 9,228.45 interest, how many days
C. P 9,250.00 in one year? A. 300
D. P 9,308.45 B. 360
C. 365
42. The Saudi Arabian Oil Refinery developed an oil well D. 366
which is estimated to contain 5,000,000 barrels of oil at One
an initial cost of $ 50,000,000. What is the depletion banker’s
charge during the year where it produces half million year is
barrels of oil? Use Unit or Factor method in computing equivale
depletion. A. $ 5,000,000.00 nt to days. A. 300
B. $ 5,010,000.00 B. 360
C. $ 5,025,000.00 C. 365
D. $ 5,050,000.00 D. 366
A manufacturer produces certain items at a labor cost
of P 115 each, material cost of P 76 each and variable cost of P 46. Annuity is required over 10 years to equate to a future
2.32 each. If the item has a unit price of P 600, how many units amount of P 15, 000 with i=5% a. P 1, 192.57
must be manufactured each month for the manufacturer to break b. P 1, 912.75
even if the monthly overhead is P428,000 c. P 1, 219.60
A. 1,033 d. P 1, 921.65
B. 1,037
 47. A debt of P 1000 is to be paid off in 5 equal yearly but offers a 3% discount for cash in 30 days. Find the
payments, each combining an amortization installment rate of interest.
and interest at 4% on the previously unpaid balance of A. 37.11%
the debt. What should be the amount of each payment? B. 40.21%
a. P 220.50 C. 38.51%
b. P 224.62 D. 39.31%
c. P 242.61
d. P 222.50
54. 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
48. P 1000 is deposited in a bank at 7% interest. What is upon release of money to a borrower. Let us therefore
the value of the money after 25 years, assuming that assume that you applied for a loan with the bank and
nothing was deposited after the initial deposit? the P80000 was approved at an interest rate of 14% of
a. P 5, 247.63 which P11200 was deducted and you were given ac
b. P 5, 437.34 check of P68800. Since you have to pay the amount of
c. P 5, 427.43 P80000 one year after, what then will be the effective
d. P 5, 720.51 interest rate?
A. 16.28%
49. What is the interest due on a P 1500 note for 4 B. 17.30%
years and 3 month, if it bears 12% ordinary
C. 38.51%
simple interest?
D. 39.31%
a. P 756 Mr. J. Dela Cruz borrowed money from the
b. P 765 bank. He received from the bank P1,340.00 and promised to pay
c. P 675 P1,500.00 at the end of 9 months. Determine the simple interest
d. P 576 rate and the corresponding discount rate or often referred to as
the “Banker’s Discount”.
A. 15.92% ; 13.73%
50. A P 1000-bond which will mature in 10 years and
with a bond rate of 10% payable annually is to be B. 12.95% ; 17.33%
redeemed at P 1040 at the end of this period. If it C.18.28% ; 13.12%
is sold now at P 1,120. Determine the yield at this D. 19.25% ; 13.33%
price.
a. 4.68 % 55. A man borrowed from the bank under a promissory
b. 6.48 % note that he signed in the amount of P25000.00 for a
c. 8.64 % period of 1year. He received only the amount of
d. 8.46 % P21,915.00 after the bank collected the advance
interest and an additional amount of P85.00 for
51. A company sets aside P 300,000 each year as a fund for notarial and inspection fees. What was the rate of
expansion. If the fund earns 9% compounded annually, interest that the bank collected in advance?
determine how long will it take before a building costing A. 13.64%
P 3, 000, 000 can be built?
a. 7.34 years
b. 7.44 years
c. 7.20 years
d. 7.54 years
Which is NOT an essential element of an ordinary annuity?
A. The amounts of all payments are equal.
B. The payments are made at equal interval of time.
C. The first payment is made at the beginning of each
period.
D. Compound interest is paid on all amounts in the
annuity.

52. An amortization of a debt is in a form of a gradient

series of P5,000 on the first year, P4,500 on the
second year, P4,000 on the third year, P3,500 on the
fourth year. What is the equivalent uniform periodic
payment if interest is 5%?
A. P4,280.47
B. P4,378.17
C. P4,259.68
D. P4,325.12

53. A price tag of P1200 is specified if paid within 60 days

B. 16.43% C.18.37% D. 10.32%
will receive at the end of the month?
56. Karen was granted a loan of P20,000 by her employer A. P3,000
CPM Industrial Fabricator and Construction Corporation B. P6,000
with an interest at 6% for 180days on the principal C. P4,000
collected in advance. The corporation would accept a D. P5,000
promissory note for P20,000 non-interest for 180days. If
discounted at once, find the proceeds in the note. 59. A bill for motorboat specifies the cost as P1,200 due at
A. P18,800 the end of 100 days but offers a 4% discount for cash in
B. P18,000 30days. What is the highest rate, simple interest at
C. P19,000 which the buyer can afford to borrow money in order to
D. P18,400 take advantage of the discount?
A. 18.4%
57. P4000 is borrowed for 75days at 16% per annum simple B. 20.9%
interest. How much will be due at the end of 75days?
C. 19.6%
A. P4186.43
D. 21.4%
B. P4133.33
C. P5124.54
D. P5625.43 60. 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
58. Mr. Bautista made a money market placement of simple interest if he agree to pay at the end of 120days?
P1,000,000 for 30 days at 7.5% per year. If withholding
tax is 20%, what is the net interest that Mr. Bautista
A. 32%
B. 28% C.40% D. 25%
On March 1, 1996 Mr. Sarmiento obtains a loan of P1500 from Mr. A. P13,610.10
Avila and signs a note promising to pay the principal and B. P13,498.60
accumulated simple interest at the rate of 5% at the end of 120days. C. P13,500.10
On May 15, 1996, Mr. Avila discounts the note at the bank whose D. P13,439.16
discount rate is 6%. What does he receive?
A. P2,201.48 69. BY the condition of a will, the sum of P2000 is left to a
B. P1,513.56 girl to be held in trust fund by her guardian until it
C. P1,123.29 amount to P50000.00. When will the girl receive the
D. P938.20 money of the fund is invested at 8% compounded
quarterly?
A. 7.98 years
61. A deposit of P110,000 was made for 31days. The
B. 11.57 years
net interest after deducting 20% withholding tax
C. 10.34 years
is P890.36. Find the rate of return annually.
D. 10.45 years
A. 12.25
B. 12.75
C. 11.75 70. A man expects to receive P25,000 in 8 years. How
D. 11.95 much is that worth now considering interest at 8%
compounded quarterly?
62. If you borrowed money from your friend with simple A. P13,859.12
interest of 12%, find the present worth of P50,000 B. P13,675.23
which is due at the end of 7months. C. P13,958.33
A. P46,200 D. P13,265.83
B. P46,729
C. P44,893 71. P500,000 was deposited at an interest of 6%
D. P45,789 compounded quarterly. Compute the compound
interest after 4 years and 9 months.
63. A man borrowed P2000 from a bank and promise to A. P163,475.37
pay the amount for 1year. He received only the B. P158,270.37
amount of P1,920 after the bank collected an advance C. P178,362.37
interest of P80. What was the rate of discount and the D. P183,327.37
rate of interest that the bank collected in advance?
A. 4% ; 4.17% 72. If the nominal interest rate is 3%, how
B. 4% ; 4.71% much is P5000 worth in 10 years in a
C. 3% ; 3.17% continuously compounded account?
D. 3% ; 3.71% A. P5750
B. P7500
64. An engineer promised to pay P36,000 at the end C. P6750
of 90days. He was offered a 10% discount if he D. P6350
pays in 30 days. Find the rate of interest.
A. 64.6% 73. P200,000 was deposited for a period of 4 years and 6
B. 66.6% months and bears on interest of P85649.25. What is
C. 65.6% the rate of interest if it is compounded quarterly?
D. 67.6% A. 8%
B. 7%
C. 6%
65. A man is required to pay P200 at the end of 160
D. 5%
days or P190 at the end of 40 days. Determine the
rate of interest.
A. 18.4% 74. How many years will P100,000 earn a compound
B. 15.8% interest of P50,000 if the interest rate is 9%
C. 19.6% compounded quarterly?
D. 16.4% A. 3.25 years
B. 5.86 years
66. Compute the discount if P2000 is discounted C. 4.55 years
for 6 months at 8% simple interest. A. P29.67 D. 2.11 years
B. P76.92 A certain amount was deposited 5 years and 9 months ago at an
C. P67.29 interest of 8% compounded quarterly. If the sum now is
D. P92.76 P315,379.85, how much was the amount deposited? A. P200,000
B. P240,000
67. The amount of P12800 in 4years at C. P180,000
5% compounded quarterly is D. P260,000 . A. P14,785.34
B. P16,311.26
C. P15,614.59 For Problems 277-279:
D. P15,847.33 When compounded Bi-monthly, P15000 becomes P22,318.30 after
A man borrows money from a bank which uses a simple discount 5years.
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. 75. What is the nominal rate of interest?
Determine the amount of money that he received from the bank. A. 7%
A. P1403.68 B. 9%
B. P1102.37 C. 8%
D. 10%
C. P1340.38
D. P1030.28
76. What is the
equivalent rate if it
68. A nominal interest of 3% compounded continuously is
is compounded
given on the account. What is the accumulated amount
quarterly? A. 7.03%
of P10,000 after 10 years?
 B. 9.03% compounded annually at nominal rate of 5% and if it is
C. 8.03% compounded continuously for 5 years at the same rate.
D. 10.03% A. P3.87
B. P5.48
77. What is the C. P4.21
effective rate if it D. P6.25
is compounded
quarterly? A. 86. If the effective rate is 24%, what nominal rate of
7.28% interest is charged for a continuously compounded
B. 9.28% loan?
A. 21.51%
C. 8.28%
B. 23.25%
D. 10.28%
C. 22.35%
D. 21.90%
78. How will it take a money to double itself if
invested at 5% compounded annually?
A. 12.2 years
87. What is the nominal rate of interest compounded
continuously for 8 years if the present worth factor is
B. 14.2 years
equal to 0.6187835?
C. 13.2 years
D. 15.2years A. 4%
B. 6%
79. Compute the effective annual interest rate which is C. 5%
equivalent to 5% nominal annual interest D. 7%
compounded continuously.
A. 5.13% 88. What is the difference of the amount 3 years from
B. 5.26% now for a 10% simple interest and 10% compound
C. 4.94% interest per year? (P5000 accumulated)
D. 4.90% A. P155
B. same
80. Find the time required for a sum of money to triple itself C. P100
at 5% per annum compounded continuously. D. P50
A. 21.97 years Find the discount if P2,000 is discounted for 6 months at 8%
B. 18.23 years compounded quarterly. A. P76.92
C. 25.34 years B. P77.66
D. 23.36 years C. P80.00
D. P78.42
81. 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 89. If a sum of money triples in a certain period of time at a
will pay 6% compounded continuously? given rate interest, compute the value of the single
A. P24,751.34 payment present worth factor.
B. P28,864.36 A. 0.333
C. P36,421.44 B. 0.292
D. P30,468.42 C. 3.000
If the effective annual interest rate is 4%, compute the D. 1.962
equivalent nominal annual interest compounded
continuously. 90. If the single payment amount factor for a period
A. 3.92% of 5 years is 1.33822. What is the nearest value of
B. 3.80% the interest rate?
C. 4.10% A. 8%
D. 4.09% B. 5%
D. 7%
82. What is the nominal rate of interest D. 6%
compounded continuously for 10 years if the
compound amount factor is equal to 1.34986? 91. If the single payment present worth factor for a
A. 3% period of 8 years is equal to 0.58201, compute the
B. 5% nearest value of the rate of interest for that period.
C. 4% A. 6%
D. 6% B. 5%
C. 7%
83. American Express Corp. charges 1.5% interest per D. 8%
month, compounded continuously on the unpaid
balance purchases made on this credit card. Compute 92. If money is worth 8% compounded quarterly,
the effective rate of interest. A. 19.72% compute the single payment amount factor for a
B. 21.20% period of 6 years.
C. 20.25% A. 1.60844
D. 19.90% B. 1.70241
C. 0.62172
84. If the nominal interest is 12% compounded D. 0.53162
continuously, compute the effective annual rate if
interest. 93. A sum of P1,000 is invested now and left for 8 years, at
A. 12.75% which time the principal is withdrawn. The interest has
B. 12.40% an accrued left for another 8 years. If the effective
C. 11.26% annual interest is 5%, what will be the withdrawn
D. 11.55% amount at the end of the 16th year?
A. P507.42
85. Compute the difference in the future amount of P500 B. P750.42
 C. P705.42 Compute the interest for an amount of P200,000 for a period of 8
D. P425.07 years.

For problems 298 - 300:

94. If it was made at a simple interest rate of 16% . A. P274,000
B. P256,000
C. P265,000
D. P247,000

95. 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
If it was made at 16% compounded continuously. A. P422,462.64
B. P524,242.46
C. P507,233.24
D. P519,327.95
B. 7.25 years
96. Find the value of x, (F/P, x, 6) if F/P compounded C. 6.25 years
quarterly is equal to 1.612226. D. 8.25 years
A. 7% A man loan P2000 from the bank. How long would it take in years
B. 5% if it was made at 8% compounded continuously.
C. 8% E. 7.18 years
D. 6% F. 5.18 years
G. 8.18 years
97. Find the value of y, (P/F, 6%, y) if P/F H. 6.18 years
compounded bi-monthly is equal to 0.787566.
A. 7 years
104. An amount of P1000 becomes P1608.44 after 4
B. 5 years years compounded bi-monthly. Find the nominal rate of
C. 6 years interest, the effective rate of interest, and the equivalent
D. 4 years rate of interest if it is compounded quarterly.
A. 11% ; 12.623% ; 11.42%
98. Find the rate of interest if compound amount B. 12% ; 11.06% ; 12.724%
factor compounded bi-monthly for 5 years is equal C. 12% ; 12.616% ; 12.06%
to 1.487887. D. 11% ; 11.664% ; 11.93%
A. 7%
B. 5% 105. How long would it take your money to double
C. 8% itself if it is invested at 6% simple interest, compounded
D. 6% semi-quarterly, and compounded continuously?
A. 12.67 yrs ; 11.2 yrs ; 15.05 yrs
99. Compute the nominal rate for a period of 6 years for B. 18.67 yrs ; 11.6 yrs ; 11.24 yrs
an effective rate of 8.33% if it is compounded C. 16.67 yrs ; 11.6 yrs ; 11.55 yrs
continuously. D. 17.67 yrs ; 10.2 yrs ; 11.45 yrs
A. 7%
B. 5% For problems 312 - 314:
C. 8% An amount of P50,000 was invested for 3 years.
D. 6%
106. Compute its interest at the end of 3
100. Compute the equivalent compound years if it is invested at 10% simple interest. A.
amount factor if it is compounded continuously. A. P16,550.00
1.61607 B. P15,000.00
B. 1.24532 C. P17,492.94
D. P14,242.15
C. 1.24282
D. 0.24245
107. Compute for its compound interest if it
is invested at 10% compounded annually. A.
101. Compute the equivalent present
P16,550.00
worth factor if it is compounded continuously.
B. P15,000.00
A. 1.249347
B. 1.243248 C. P17,492.94
C. 1.214359 D. P14,242.15
D. 0.616783
108. Compute its interest if it
102. A man loan P2000 from the bank. How long is invested at 10% compounded
would it take in years for the amount of the loan and continuously. A. P16,550.00
interest to equal P3280 if it was made at 8% simple B. P15,000.00
interest. C. P17,492.94
A. 7 years D. P14,242.15
B. 5 years
C. 8 years For Problems 315 - 317:
D. 6 years P200,000 was deposited for a period of 4 yrs. And 6
months and bears on interest of P85,659.25.
103. A man loan P2000 from the bank. How long
would it take in years if it was made at 8% 109. What is the nominal
compounded quarterly. rate of interest if it is
A. 5.25 years compounded quarterly? A.
 8.00% D. 7.96%
B. 7.00%
C. 8.24%
110. What is the actual rate of interest? A. 8.00%
B. 7.00%
C. 8.24%
D. 7.96%
What is the equivalent nominal rate if it is C. 8.93%
compounded semi-quarterly? A. 8.00% D. 9.93%
B. 7.00%
C. 8.24% 115. What is the value of the compound
D. 7.96% amount factor if it is compounded continuously? A.
1.377128
111. What is the value of B. 1.424231
(F/P, 8%, 6) if it is compounded C. 0.214212
semi-quarterly. A. 0.524273541 D. 0.122416
B. 1.487886717
C. 0.787566127 116. What is the value of the present
D. 1.612226000 worth factor if it is compounded continuously?
A. 1. 272441
112. What is the value B. 0.272441
of (P/F, 6%, 4) if it is C. 1.726419
compounded bi-monthly. D. 0.726149
A. 0.524273541
B. 1.487886717 117. If the single payment amount factor for
C. 0.787566127 a period of 5 years is 1.33822, what is the
D. 1.612226000 nominal rate of interest?
A. 6.00%
B. 7.00%
113. 320.What is the single payment
C. 6.92%
compound amount factor for 8% compounded bi-
D. 7.92%
monthly for 5 years.
What is the effective rate of interest if it is compounded semi-
A. 0.524273541
annually of problem no. 324?
B. 1.487886717
A. 5.00%
C. 0.787566127
B. 7.24%
D. 1.612226000
C. 6.92%
For Problems 321 - 323: D. 6.09%
If money is invested at a nominal rate of interest of 8% for
a period of 4 years. 118. What is the equivalent nominal rate if it is
compounded quarterly of problem no. 324? A. 6.12%
114. What is the B. 4.24%
effective rate if it is C. 5.43%
compounded D. 5.87%
continuously? A.
8.33%
B. 9.33%
119. Money was invested at x% compounded quarterly. If it takes money to quadruple in
17.5 years, find the value of x. A. 6.23%
B. 8.00%
C. 5.92%
D. 9.78%

120. What is the actual interest rate of problem no. 327? A. 7.24%
B. 7.92%
C. 8.24%
D. 8.87%
of 5 years if it was made at 12% compound semi-
121. What is the equivalent quarterly?
rate if problem no. 327 is A. P800,000.00
compounded daily? A. 7.24% B. P911,059.20
B. 7.92% C. P823,243.09
C. 8.24% D. P907,009.21
D. 8.87%
124. How much is he going to pay at the end
For Problems 330 - 332:
of 5 years if it was made at 12% compound
A businessman loaned P500,000 from a local bank that
continuously?
charges an interest rate of 12%.
A. P800,000.00
B. P911,059.20
122. How much is he going to pay at the end of 5 C. P823,243.09
years if it was made at 12% simple interest? A. D. P907,009.21
P800,000.00 P60,000 was deposited at 6% compounded quarterly, tax free for 9
B. P911,059.20 years and 3 months. How much interest was earned at the end of
C. P823,243.09 the period?
D. P907,009.21 A. P43,214.24
B. P44,086.60
123. How much is he going to pay at the end
 C. P43.242.24 D. P30,546.01
D. P44,215.60
133. An initial savings deposit of P80,000 in a certain
bank earns 6% interest per annum compounded monthly.
125. P100,000 was placed in a time deposit which
If the earnings from the deposit are subject to a 20% tax,
earned 9% compounded quarterly tax free. After how
what would the net value of the deposit be after three
many years would it be able to earn a total interest of
quarters?
P50,000?
A. P95,324.95
A. 4.56 years
B. P68743.24
B. 3.45 years
C. P82938.28
C. 4.23 years
D. P56244.75
D. 3.64 years

126. P200,000 was placed in a time deposit at

134. The effective rate of
interest of 14% compounded
x% compounded quarterly and was free of taxes.
semi-annually is: A. 14.49%
After exactly 5 years, the total interest earned was
P120,000. What is the value of x? A. 9.5% B. 14.94%
C. 14.36%
B. 6.35%
D. 14.88%
C. 8.21%
D. 7.12%
135. The amount of P50,000 was deposited in a
bank earning an interest of 7.5% per annum. Determine
127. Which of these gives the lowest effective rate of
the total amount at the end of 5 years, if the principal
interest?
and interest were not withdrawn during the period.
A. 12.35% compounded annually
A. P71,781.47
B. 12.2% compounded quarterly
B. P70,374.90
C. 11.9% compounded semi-annually
C. P72,475.23
D. 11.6% compounded monthly
D. P78,536.34
128. It takes 20.15 years to quadruple your
money if it is invested at x% compounded semi-
136. What is the effective rate corresponding to 18%
compounded daily? Take 1 year is equal to 360 days.
annually. Find the value of x.
A. 18.35%
A. 8%
B. 18.10%
B. 7%
C. 19.39%
C. 6%
D. 19.72%
D. 5%

129. It takes 13.87 years to treble the

137. If P1,000 becomes P1,126.49 after 4 years
when invested at a certain nominal rate of interest
money at the rate of x% compounded quarterly.
Compute the value of x. compounded semi-annually, determine the nominal
A. 5% rate and the corresponding effective rate.
B. 7% A. 3.00% and 3.02%
C. 6% B. 2.30% and 2.76%
D. 8% C. 4.29% and 4.32%
D. 3.97% and 3.95%
130. Money was invested at x% compounded
quarterly. If it takes the money into quadruple in 17.5 138. Conv
years, find the value of x. ert 12% semi-
A. 8% annually to
B. 7% compounded
quarterly. A.
C. 6% 19.23%
D. 5%
B. 14.67%
C. 23.56%
131. Fifteen years ago P1,000.00 was
D. 11.83%
deposited in a bank account, and today it is worth
What is the corresponding effective interest rate of 18%
P2.370.00. The bank pays interest semi-annually.
compounded semi-quarterly? A. 19.25%
What was the interest rate paid on this account?
B. 18.46%
A. 4.9%
C. 19.48%
B. 5.0%
D. 18.95%
C. 5.8%
D. 3.8% 139. If P5000 shall accumulate for 10
You borrow P3,500.00 for one year from a friend at an interest years at 8% compounded quarterly, find
rate of 1.5% per month instead of taking a loan from a bank at a the compounded interest at the end of 10
rate of 18% per year. Compare how much money you will save or years.
lose on the transaction. A. P6,005.30
A. pay P155 more if you borrowed from the bank B. P6,040.20
B. save P55 by borrowing from your friend C. P6,000.00
C. pay P85 more if you borrowed from the bank D. P6,010.20
D. save P95 by borrowing from your friend
140. A couple borrowed P4,000 from a lending
132. Find the present worth of a future payment company for 6 years at 12%. At the end of 6 years, it
of P1000,000 to be made in 10 years with an interest renews the loan for the amount due plus P4,000 more
of 12% compounded quarterly. for 3 years at 12%. What is the lump sum due?
A. P30,444.44 A. P14,842.40
B. P30,655.68 B. P12,316.40
C. P33,000.00 C. P16,712.03
 D. P15,382.60 148. If the inflation rate is 6%, cost of money
is 10%, what interest rate will take care of
141. How long (in years) will it take the money to inflation and the cost of money?
quadruple if it earns 7% compounded semi- annually? A. 16.6%
A. 26.30 years B. 17.7%
B. 33.15 years C. 15.5%
D. 14.4%
C. 40.30 years
D. 20.15 years
149. A man bought a government bond which cost
P1000 and will pay P50 interest each year for 20 years.
142. P200,000 was deposited on Jan. 1,1988 at
The bond will mature at the end of 20 years and he will
an interest rate of 24% compounded semi- annually.
receive the original P1000. If there is 2% annual inflation
How much would the sum be on Jan. 1, 1993?
during this period, what rate of return will the investor
A. P421,170
receive after considering the effect of inflation?
B. P401,170
A. 2.94%
C. P521,170
B. 4.25%
D. P621,170
C. 3.16%
D. 5.16%
143. If P500,000 is deposited at a rate of
11.25% compounded monthly, determine the
compounded interest after 7 years and 9 months.
150. The inflated present worth of P2000 in two
years is equal to P1471.07. What is the rate of inflation
A. P690,849
if the interest rate is equal to 10%?
B. P680,686
A. 6%
C. P670,258
B. 7%
D. P660,592
C. 5%
D. 4%
144. 355P200,000 was deposited at an 12% rate of interest can take care of the cost of money and
interest rate of 24% compounded semi-annually. inflation. If the nominal rate of interest is 6%, what is the rate of
After how many years will the sum be P621,170? inflation?
A. 4 years A. 6.62%
B. 5 years B. 7.67%
C. 3 years C. 5.66%
D. 6 years D. 4.64%

145. A bank is advertising 9.5% accounts that yields 151. An engineer bought an equipment for
9.84% annually. How often is the interest compounded? P500,000. Other expenses including installations
A. monthly amounted to P30,000. At the end of its estimated useful
B. quarterly life of 10 years, the salvage value will be 10% of the first
C. bi-monthly cost. Using straight line method of depreciation, what is
D. daily the book value after 5 years?
A marketing company established a program to replace the cars of A. P291,500
its sales representatives at the end of every 5 years. If the present B. P242,241
price of the approved type of car is P520,000.00 with a resale value C. P282,242
at the end of 5 years of 60% its present value, how much money D. P214,242
must the company accumulate for 5 years if inflation annually is
10%. Release value will also appreciate at 10% yearly. 152. A small machine costing P80,000 has a salvage
A. P120,289.51 value of x at the end of its life of 5 years. The book value
B. P110,297.27 at the end of the 4th year is P22,400. What is the value
C. P129,382.38 of x using the straight line method depreciation?
D. P122,265.69 A. P6000
B. P8000
146. In year zero, you invest P10,000.00 in a 15% C. P7000
security for 5 years. During that time, the average D. P9000
annual inflation is 6%. How much, in terms of year
zero will be in the account atmaturity? 153. A machine has a salvage value of P12,000
A. P15,386.00 at the end of its useful life of 6 years. The book
B. P13,382.00 value at the end of 5 years is P30,833.33. Using a
straight line method of depreciation,what is the
C. P15,030.00
first cost of the machine?
D. P16,653.00
A. P125,500
B. P125,000
147. A machine has been purchased and installed
C. P135,500
at a total cost of P18,000.00. The machine will be
D. P135,000
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 154. A manufacturing plant was built at a cost of
an exact duplicate. The company plans to establish a P5M and is estimated to have a life of 20 years with a
reserve fund to accumulate the capital needed to salvage value of P1M. A certain equipment worth
replace the machine. If an average annual rate of P570,000 was installed at a cost of P80,000 is expected
inflation of 3% is anticipated, how much capital must be to operate economically for 15 years with a salvage
accumulated? value of P50,000. Determine the book value of the
plant and equipment after 10 years, use straight line
A. P15,030.00
depreciation method.
B. P12,382.00
A. P3,250,000
C. P18,548.39
B. P4,250,000
D. P15,386.00
C. P3,750,000
D. P4,500,000
 155. A printing equipment costs P73,500 has a P
life expectancy of 8 years and has a salvage value of 8
P3,500 at the end of its life. The book value at the 0
end of x years is equal to P38,500. Using straight line 0
method of depreciation, solve for the value of x. ,
A. 5 years 0
B. 6 years 0
C. 4 years 0
D. 3 years B. P900,000
C. P600,000
156. The cost of the printing equipment is P500,000 D. P700,000
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 159. U
P242,000 and the life of the equipment is assumed to be s
5 years, determine the salvage value of this equipment at i
the end of 5 years. n
A. P50,000 g
B. P53,000
C. P60,000 S
D. P64,000 u
An engineer bought an equipment for P500,000. He spent an m
additional amount of P30,000 for installation and other
expenses. The salvage value is 10% of the first cost. If the book o
value at the end of 5 years will be P291,500 using straight line f
method of depreciation, compute the useful life of the
equipment in years. Y
A. 10 years e
a
B. 6 years
r
C. 8 years s
D. 15 years
D
157. The cost of equipment is P500,000 and the cost i
of installation is P30,000. If the salvage value is 10% of g
the cost of equipment at the end of 5 years, determine i
the book value at the end of the fourth year. Use straight t
line method.
A. P155,000 M
B. P146,000 e
C. P140,000 t
D. P132,600 h
o
For Problems 172-174: d
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 A
total depreciation after 3 years. .

158. U P
s 1
i ,
n 1
g 5
0
S ,
t 0
r 0
a 0
i B. P1,300,000
g C. P1,200,000
h D. P1,350,600
t
160. U
L s
i i
n n
e g

M C
e o
t n
h s
o t
d a
n
A t
.
 P 164. A machine has a first of P80,000 and a salvage
e of P2,000 at the end of its life of 10 years. Find the book
r value at the end of the 6th year using straight line
c method of depreciation.
e A. P33,200
n B. P34,300
t C. P35,400
a D. P32,900
g
e 165. An asset is purchased for P90,000.00. Its
estimated life is 10 years after which it will be sold for
M P1,000.00. Find the book value during the first year if
e Sum of the Years Digits(SYD) depreciation is used.
t
A. P7,545.45
h
o B. P5,245.92
d C. P2,980.24
D. P6,259.98
A
. 166. A telephone company purchased a
microwave radio equipment for P6M. Freight and
P installation charges amounted to 3% of the
1 purchased price. If the equipment shall be
, depreciated over a period of 8 years with a salvage
3 value of 5%, determine the depreciation charge
5 during the 5th year using the Sum of Year Digit
5 Method.
, A. P756,632.78
0 B. P652,333.33
2 C. P957,902.56
4 D. P845, 935.76
.
2
4
167. A consortium of international communications
companies contracted for the purchase and installation
B. P1,246,422.53 of a fiber optic cable linking two major Asian cities at a
C. P1,185,769.76 total cost of P960M. This amount includes freight and
D. P1,432,624.84 installation charges at 10% of the above total contract
price. If the cable depreciated over a period of 15 years
161. An asset is purchased for P9,000.00. Its with zero salvage value, what is thedepreciation charge
estimated economic life is 10 years after which it will be during the 8th year using the sum of year digits method?
sold for P1,000.00. Find the depreciation in the first three A. P64 M
years using straight line method. B. P80 M
A. P2,500
C. P23 M
B. P3,000
D. P76 M
C. P2,400
D. P2,000 168. A machine cost P7,350 has a life of 8 years and
has a salvage value of P350 at the end of 8 years.
162. The purchase of a motor for P6000 and a Determine its book value at the end of 4 years using sum
generator for P4000 will allow the company to produce years digit method.
its own energy. The configuration can be assembled for A. P3,476.90
P500. The service will operate for 1600 hours per year for B. P6,543.21
10 years. The maintenance cost is P300 per year, and cost C. P2,294.44
to operate is P0.85 per hour for fuel and related cost. D. P5,455.01
Using straight line depreciation, what is the annual cost A certain equipment costs P7,000 has an economic life of n years
for the operation? There is a P400 salvage value for the and a salvage value P350 at the end of n years. If the book value at
system at the end of 10 year. the end of 4 years is equal to P2197.22, compute for the economic
A. P2,710 life of the equipment using the sum of years digit method.
B. P2,630 A. 10 years
C. P2,480 B. 8 years
D. P2,670 C. 16 years
A machine has an initial cost of P50,00.00 and a salvage value of D. 11 years
P10,000.00 after 10 years. What is the straight line method
depreciation rate as a percentage of the initial cost? A. 10% 169. A company purchased an asset for P10000
B. 12% and plans to keep it for 20 years. If the salvage value is
C. 8% zero at the end of the 20th year, what is the
D. 9% depreciation in the third year? Use sum of years digit
method.
163. A machine has an initial cost of P50,00.00 A. P1000
and a salvage value of P10,000.00 after 10 years. B. P938
What is the book value after 5 years using straight C. P857
line method depreciation rate? D. P747
A. P35,000
B. P15,500 170. An equipment costs P7000 and has a life of 8
C. P25,000 years and salvage value of x after 8 years. If the book
D. P30,000 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. 176. A certain machine cost P40,000 and has a life
A. P594 of 4 years and a salvage value of P5000. The production
B. P350 output of this machine in units per year is 1000 units for
C. P430 the first year, 2000 units for the second year, 3000 units
D. P290 for the third year, and 4000 units for the fourth year. If
the units produced are in uniform quality, what is the
171. ABC Corporation makes it policy that for depreciation charge at the end of the fourth year.
every new equipment purchased, the annual A. P14,000
depreciation should not exceed 20% of the first cost
B. P15,000
at any time without salvage value. Determine the
C. P13,000
length of service if the depreciation used is the SYD
D. P16,000
Method.
A. 9 years 177. A lathe machine costs P300,000 brand new
B. 12 years with a salvage value of x pesos. The machine is expected
C. 10 years to last for 28500 hours in a period of 5 years. In the first
D. 19 years year of service it was used for 8000 hours. If the book
value at the end of the first year is P220,000, compute
172. A machine having a certain first cost has a life for the salvage value x in pesos.
of 10 years and a salvage value of 6.633% of the first A. P15,000
cost at the end of 10 years. If it has a book value of
B. P12,000
P58,914 at the end of the 6thyear, how much is the first
cost of the machine if the constant percentage of C. P18,000
declining value is used in the computation for its D. P20,000
depreciation.(Matheson’s Method)
A. P600,000
B. P100,000 178. A bookstore purchased a best-selling book
C. P300,000 at P200.00 per copy. At what price should this book
D. P900,000 be sold so that by giving a 20% discount, the profit is
30%.
A. P200.00
173. A machine costing P720,000 is estimated to
B. P300.00
have a life of 10 years. If the annual rate of depreciation
C. P400.00
is 25%, determine the total depreciation using a
D. P500.00
constant percentage of the declining balance method.
A. P679,454.27
179. A businessman wishes to earn 7% on his
B. P532,825.73 capital after payment of taxes. If the income from an
C. P432,725.45 available investment will be taxed at an average of 42%,
D. P764,243.33 what minimum rate of return, before payment of taxes,
must the investment offer to be justified?
174. An earth moving equipment that cost P90,000 A. 13.02%
will have an estimated salvage value of P18,000 at the B. 12.07%
end of 8 years. Using double-declining balance method, C. 10.89%
compute the book value and the total depreciation at D. 11.08%
the end of the 5th year.
A. P21,357.42 ; P68,642.58 180. A manufacturing firm maintains one product
B. P24,362.48 ; P65,637.52 assembly line to produce signal generators. Weekly
C. P15,830.34 ; P74,169.66 demand for the generators is 35 units. The line operates
D. P19,442.78 ; P70,557.22 for 7 hours per day, 5 days per week. What is the
A certain office equipment has a first cost of P20,000 and has a maximum production time per unit in hours required of
salvage value of P1,000 at the end of 10 years. Determine the the line to meet the demand?
depreciation at the end of the 6th year using Sinking fund method A. 1 hour
at 3% interest. B. 1 hour and 10 minutes
A. P10,720 C. 1 hour and 15 minutes
B. P11,680 D. 1 hour and 30 minutes
C. P12,420
D. P9,840 181. Froyd Corporation’s gross margin is 45% of
sales. Operating expenses such as sales and
175. An equipment costs P480,000 and has a salvage administration are 15% of sales. Froyd Corporation is in
value of 10% of its cost at the end of its economic life of 40% tax bracket. What percent of sales is their profit
35,000 operating hours. In the first year, it was used for after taxes?
4,000 hours. Determine its book value at the end of the A. 21%
first year. B. 20%
A. P430,629.00 C. 19%
B. P418,360.00 D. 18%
C. P380,420.00 In determining the cost involved in fabricating sub-assembly B
D. P376,420.00 within a company, the following data have been gathered:
An equipment costs P480,000 and has a
salvage value of 10% of its cost at the end of its economic life of D
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 i
was used for 15,000 hours, find the depreciation at the second year.
A. P180,000 r
B. P190,000
e
C. P160,000
D. P150,000
c
t r

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t P

e 0

r .

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. n

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o 0
 0 P2,856 more thanit costs Jojo, how much did Jojo pay
for the unit?
. A. P4,100
B. P3,900
0 C. P4,000
D. P4,200
0
186. 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
p was given to the customer? A. 37.5%
B. 37.9%
e
C. 38.2%
r D. 38.5%
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
s 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
e everyday thereafter. If the total penalty was P60,750.00, how many
days was the completion of the contract delayed?
t A. 26 days
B. 27 days
- C. 28 days
D. 29 days
u
187. The quarrying cost of marble and granite blocks
p plus delivery cost to the processing plant each is
P2,400.00 per cubic meter. Processing cost of marble into
It is decided to subcontract the manufacturing of tile is P200.00 per square meter and that of the granite
assembly B to an outside company. For an order of 100 units, into tiles also is P600.00 per square meter.
what is the cost per unit that is acceptable to the company?
A. P3.80 If marble has a net yield of 40 square meters of tile per
B. P4.00 cubic meter of block and sells P400 per square meter, and granite
C. P4.10 gives a net yield of 50 square meters of tiles per cubic meter of
D. P4.20 block and sells at P1000 per square meter. Considering all other
costs to be the same, the granite is more profitable than the marble
182. By selling balut at P5 per dozen, a vendor gains by how much?
20%. The cost of the eggs rises by 12.5%. If he sells at the A. P12,000 per cubic meter
same price as before, find his new gain in %. B. P13,000 per cubic meter
A. 6.89% C. P14,000 per cubic meter
B. 6.67% D. P15,000 per cubic meter
C. 6.58%
D. 6.12% 188. A man would like to invest P50,000 in
government bonds and stocks that will give an overall
183. An equipment installation job in the annual return of about 5%. The money to be invested in
completion stage can be completed in 50 days of 8 government bonds will give an annual return of 4.5% and
hour/day work, with 50 men working. With the contract the stocks of about 6%. The investments are in units of
expiring in 40 days, the mechanical engineer contractor P100.00 each. If he desires to keep his stock investment
decided to add 15 men on the job, overtime not being to minimum in order to reduce his risk, determine how
permitted. many stocks should be purchased.
A. 165
If the liquidated damages is P5,000 per day of delay, B. 166
and the men are paid P150 per day, how much money would he C. 167
save with the additional workers? D. 168
A. P43,450
B. P43,750
189. A 220 V 2 hp motor has an efficiency of 80%. If
C. P44,250
power costs P3.00 per kw-hr for the first 50 kw-hr, 2.90
D. P44,750
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 kw-hr is
184. In a certain department store, the monthly reached. How much does it cost to run this motor
salary of a saleslady is partly constant and partly varies as continuously for 7 days?
the value of her sales for the month. When the value of
A. P800
her sales for the month is P10,000.00, her salary for the
B. P820
month is P900.00. When her monthly sales go up to
C. P840
P12,000.00, her monthly salary goes up to P1,000.00.
D. P860
What must be the value of her sales so that her salary for
the month will be P2,000.00?
190. An 8-meter concrete road pavement 500
A. P30,000
meters long is desired to be constructed over a well-
B. P31,000
compacted gravel road, together with the necessary
C. P32,000
concrete curbs and gutters on both sides. In order to put
D. P33,000
the subgrade on an even level grade, a 500 cubic meters
of sand filling is necessary, over which the 10 inch
185. Jojo bought a second-hand Betamax VCR concrete pavement will be placed?
and then sold it to Rudy at a profit of 40%. Rudy then
Assume the following data:
sold the VCR to Noel at a profit of 20%. If Noel paid
A. Sand fill, including rolling and watering = P100 per cubic P1,207,000
meter B. P1,207,500
B. Concrete pavement, 10 in thick (labor and materials) C. P1,208,000
including curing = P220 per sq. Meter D. P1,208,500
C. Curbs and gutters = P12 per linear meter 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
How much will all this to consumers after deducting distribution losses of 20%. At
the project cost what average rate per kw-hr should this energy be sold to break
allowing 15% even if the following are other monthly expenses in its operation:
for
contingency? A.
Taxes Salaries
2

,
0

0
 Depreciation invested in real state at Pagadian City and the
P2,250,000 remainder were invested as follows:
Interest
P700,000 A. 30% in T-bills earning 12% interest
Maintenance B. 35% in money market placement earning 14%
P300,000 C. 35% in blue chip stock earning 13%
Miscellaneous
If her annual earnings from the T-bills, money market
P200,000
and stock is P50,000, How much did she invests in real estate?
A. P2,091,639.12
A. P4.90
B. P1,916,858.24
B. P5.20
C. P1,856,120.53
C. P5.90
D. P1,790,274.78
D. P6.30

191. An engineer bidding on the asphalting of 7 km

194. The monthly demand for ice cans being
manufactured by Mr. Alarde is 3200 pieces. With a
stretch of road is confronted with a problem of choosing
manual operated guillotine, the unit cuffing cost is
between two possible sites on which to set-up the
P25.00. An electrically operated hydraulic guillotine was
asphalt-mixing machine.
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
Site A Site B
able to recover the cost of the machine if he decides to
buy now?
Average hauling distance 2.5 km 2.75 km
A. 10 months
Monthly rental P35,000 B. 11 months
P6,500
C. 12 months
D. 13 months
Installing and dismantling of machine P20,000 P10,000
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:
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
Processing Method Cost per ton
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 A P5,500
contractor at P42 per cubic meter per km of haul. How much is site
B more expensive than site A?
A. P949,645 B P2,500
B. P962,101
C. P956,807 C P400
D. P974,090

192. A fixed capital investment of P10,000,000 is If gold can be sold at P4,000 per ounce, which method of
required for a proposed manufacturing plant and an processing yield the biggest return?
estimated working capital of P2,000,000. Annual A. PRocessing method A
depreciation is estimated to be 10% of the fixed capital B. Processing method B
investment. Determine the rate of return on the total C. Processing method C
investment if the annual profit is P2,500,000. D. Either of the processing methods B or C
A. 28.33%
B. 29.34% 472. JRT Motors Inc. has been shipping its Suzuki
C. 30.12% engines in containers to avoid the necessary crating of
D. 30.78% the engines. JRT Motors Inc. will pay freight on container
A call to bid was advertised in the Philippine Daily Inquirer for the load of 40 tons, regardless of whether or not the
construction of a transmission line from a mini-hydroelectric power container is completely filled with engines. Record shows
plant to the substation which is 5.035 kilometers away. The tanalized that due to engine size, JRT Motors Inc. has shipped only
timber electrical posts must be placed at an interval of 50 m. The 30 tons per container. Freight of container cost P3.00 per
electrical posts must be 30 feet long, 8 inches in diameter at the tip kilograms.
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 If the engines are crated so that they can be shipped at
post. Compute the estimated cost for the project using the following the rate of P3.50 per hundred kilograms with the freight bill
data: computed only on the actual weight shipped. The cost of crating
would be P50 per engine and would increase the shipping weight
Cost of one tanalized timber post 30 feet long is P5,000 from 1500 kg to 1520 kg per engine. How much more economical
including delivery to the site. Labourer at P180 per day and 5 shipping the engine in crates than in containers?
laborers can dig and erect 3 posts per day. Electrician at P250 per
day and 4 electricians can strung wires complete 150 meters per
A. P670 per engine
day. Electric wire cost P4.00 per meter. Use only 5 laborers and 4 B. P630 per engine
electricians for the project and is supervised by a foreman which C. P650 per engine
is paid at P400 per day. Contingency is 10% and profit is 25%. D. P610 per engine
A. P745,890.23
B. P817,692.00 473. A paint manufacturing company uses a sand
C. P789,120.80 mill for fine grinding of paint with an output of 100 liters
D. P829,592.50 per hour using glass beads as grinding media. Media load
in the mill is 25 kg costing P200.00 per kg and is fully
193. Upon the retirement after 44 years in replenished in 2 months time at 8 hours per day
government service, Mrs. Salud Araoarao was able to operation, 25 days a month. A ceramic grinding media is
get a retirement lump sum of P2,300,000. As a hedge offered to this paint company, costing P400 per kg and
against inflation, she decided to use a part of it 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 481. A man borrowed P2,000 from a bank and
media? promised to pay the amount for one year. He received
A. P436,900 only the amount of P1,920 after the bank collected an
B. P462,000 advance interest of P80.00. What was the rate of
C. P473,000 interest that the bank collected in advance?
D. P498,200 A. 4.00%
B. 4.07%
474. If P1000 accumulates to P1500 when invested C. 4.17%
at a simple interest for three years, what is the rate of D. 4.25%
interest?
A. 14.12% 482. What will be the future worth of
B. 15.89% money after 12 months if the sum of P25,000 is
C. 16.67% invested today at simple interest rate of 1% per
D. 16.97% year?
A. P25,168
475. You loan from a loan firm an amount of
B. P25,175
P100,000 with a rate of simple interest of 20% but the
C. P25,189
interest was deducted from the loan at the time the
D. P25,250
money was borrowed. If at the end of one year, you
What will be the future worth of money after 12 months if
have to pay the full amount of P100,000, what is the
the sum of P25,000 is invested today at simple interest
actual rate of interest?
rate of 1% per month?
A. 23.5% A. P28,000
B. 24.7% B. P28,165
C. 25.0%
C. P28,289
D. 25.8%
A loan of P5,000 is made for a period of 15 months, at a simple D. P28,250
interest rate of 15%, what future amount is due at the end of
the loan period? 483. 480 It is the practice of almost all banks in the
A. P5,937.50 Philippines that when they grant a loan, the interest for
B. P5,873.20 one year is automatically deducted from the principal
C. P5,712.40 amount upon release of money to a borrower. Let us
therefore assume that you applied for a loan with a
D. P5,690.12
bank and the P80,000 was approved at an interest rate
of 14% of which P11,200 was deducted and you were
476. If you borrowed money from your friend given a check of P68,800. Since you have to pay the
with simple interest at 12%, find the present worth of amount of P80,000 one year after, what then will be the
P50,000, which is due at the end of 7 months. effective interest rate?
A. P46,728.97 A. 16.02%
B. P47,098.12
B. 16.28%
C. P47,890.12
D. P48,090.21 C. 16.32%
D. 16.47%
477. Mr. J. Reyes borrowed money from the
bank. He received from the bank P1,842 and 484. A deposit of P110,000 was made for 31
promised to repay P2,000 at the end of 10 months. days. The net interest after deducting 20%
Determine the rate of simple interest. withholding tax is P890.36. Find the rate of return
A. 12.19% annually.
B. 12.03% A. 11.50%
C. 11.54% B. 11.75%
D. 10.29% C. 11.95%
D. 12.32%
478. If you borrowed P10,000 from a bank with
18% interest per annum, what is the total amount to 485. P5,000 is borrowed for 75 days at 16% per
be repaid at the end of one year? annum simple interest. How much will be due at the
A. P10,900 end of 75 days?
A. P5,066.67
B. P11,200
B. P5,133.33
C. P11,800 C. P5,050.00
D. P12,000 D. P5,166.67

479. A price tag of P1,200 is payable in 60 days 486. A businessman wishes to earn 7% on his
but if paid within 30 days it will have a 3% discount. capital after payment of taxes. If the income from an
Find the rate of interest. available investment will be taxed at an average rate
A. 35.45% of 42%, what minimum rate of return, before
B. 35.89% payment of taxes, must the investment offer to be
C. 36.18% justified?
D. 37.11%
A. 12.07%
B. 12.34%
480. A man borrowed P2,000 from a bank and C. 12.67%
promised to pay the amount for one year. He received D. 12.87%
only the amount of P1,920 after the bank collected an
advance interest of P80.00. What was the rate of
discount?
487. A man borrowed P20,000 from a local
commercial bank which has a simple interest of 16%
A. 3.67%
but the interest is to be deducted from the loan at the
B. 4.00%
time that the money was borrowed and the loan is
C. 4.15%
payable at the end of one year. How much is the actual
D. 4.25%
 rate of interest?
A. 19.05%
B. 19.34%
C. 19.67%
D. 19.87%

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

annum simple interest. How much will be due at the
end of 75 days?
A. P4,033.33
B. P4,333.33
C. P4,133.33
D. P4,666.67
 489. Agnes Abanilla was granted a loan of P20,000 C. P665.21
by her employer CPM Industrial Fabricator and D. P666.39
Construction Corporation with an interest rate of 6% for
180 days on the principal collected in advance. The
496. The exact simple interest of P5,000 invested
corporation would accept a promissory note for P20,000
from June 21,1995 to December 25,1995 is P100. What
non-interest for 180 days. If discounted at once, find the
is the rate of interest?
proceeds of the note.
A. 3.90%
A. P18,800 B. 3.92%
B. P18,900 C. 3.95%
C. P19,000 D. 3.98%
D. P19,100
497. A man invested P110,000 for 31 days. The net
490. If you borrow money from your friend interest after deducting 20% withholding tax is P890.36.
with simple interest of 12%, find the present worth Find the rate of return annually.
of P20,000 which is due at the end of nine months. A. 11.50 %
A. P18,992.08 B. 11.75 %
B. P18,782.18 C. 11.95 %
C. P18,348.62 D. 12.32 %
D. P18,120.45
498. On her recent birthday, April 22, 2001, Nicole
491. A man borrowed from a bank under a was given by her mother a certain sum of money as
promissory note that he signed in the amount of birthday present. She decided to invest the said amount
P25,000.00 for a period of one year. He receives only the on 20% exact simple interest. If the account will mature
amount of P21,915.00 after the bank collected the on Christmas day at an amount of P10,000.00, how much
advance interest and an additional of P85.00 for notarial did Nicole receive from her mother on her birthday?
and inspection fees. What was the rate of interest that
the bank collected in advance? A. P8,807.92
A. 13.05% B. P8,827.56
B. 13.22% C. P8,832.17
C. 13.46% D. P8,845.78
D. 13.64%
499. What is the
492. Mr. Danilo Conde borrowed money from a ordinary interest on
bank. He received from the bank P1,340.00 and P1,500.50 for 182 days at
promised to pay P1,500.00 at the end of 9 months. 5.2%? A. P39.01
Determine rate of simple interest. B. P39.45
A. 15.92% C. P39.82
B. 15.75% D. P39.99
C. 15.45%
D. 15.08% 500. Nicole has P20,400 in cash. She invested it at 7%
from March 1, 2006 to November 1,
493. Mr. J. Dela Cruz borrowed money from a bank. 2006 at 7% interest. How much is the interest using the
He receives from the bank P1,340.00 and promised to Banker’s Rule?
pay P1,500.00 at the end of 9 months. Determine the A. P972.12
corresponding discount rate or often referred to as the B. P970.78
“banker’s discount.” C. P973.12
D. P971.83
A. 13.15%
B. 13.32%
C. 13.46%
501. The amount of P20,000 was deposited in a
bank earning an interest of 6.5% per annum. Determine
D. 13.73%
the total amount at the end of 7 years if the principal
and interest were not withdrawn during this period?
494. Annie buys a television set from a merchant
who ask P1,250.00 at the end of 60 days. Annie wishes A. P30,890.22
to pay immediately and the merchant offers to B. P30,980.22
compute the cash price on the assumption that C. P31,079.73
money is worth 8% simple interest. What is the cash D. P31,179.37
price?
A. P1,124.67 502. A loan for P50,000 is to be paid in 3
B. P1,233.55 years at the amount of P65,000. What is the
effective rate of money?
C. P1,289.08
D. P1,302.67
A. 9.01%
495. A man borrowed money from a loan shark. He B. 9.14%
receives from the loan shark and amount of P1,342.00 C. 9.31%
and promised to repay P1,500.00 at the end of 3 D. 9.41%
quarters. What is the simple interest rate? The amount of P50,000 was deposited in the bank earning an
A. 15.47% interest of 7.5% per annum. Determine the total amount at the end
B. 15.69% of 5 years, if the principal and interest were not withdrawn during
the period.
C. 15.80%
A. P71,781.47
D. 15.96% B. P71,187.47
Determine the exact simple interest on P5,000 invested for the
period from January 15,1996 to October 12,1996, if the rate C. P71,817.47
interest is 18%. D. P71,718.47
A. P664.23
B. P664.89 503. Find the present worth of a future payment
of P80,000 to be made in six years with an interest of
 12% compounded annually. compounded quarterly.
A. P40,540.49 A. P30,555.68
B. P40,450.49 B. P30,656.86
C. P40,350.49 C. P30,556.86
D. P40,530.49
D. P30,655.68

504. What is the effective rate corresponding to 18%

513. In how many years is required for
compounded daily? Take 1 year is equal to 360 days.
P2,000 to increase by P3,000 if interest at 12%
A. 19.61%
compounded semi-annually?
B. 19.44%
C. 19.31% A. 7.86 years
D. 19.72% B. 7.65 years
C. 7.23 years
505. What nominal rate, compounded D. 8.12 years
semi-annually, yields the same amount as 16%
compounded quarterly? 514. The amount of P150,000 was deposited in the
A. 16.09% bank earning an interest of 7.5% per annum. Determine
B. 16.32% the total amount at the end of 5 years, if the principal
C. 16.45% and interest were not withdrawn during the period.
D. 16.78% A. P215,344.40
B. P213,544.40
506. What rate of interest compounded C. P234,153.40
annually is the same as the rate of interest of 8% D. P255.443.10
compounded quarterly?
A. 8.07% 515. How long will it take money to double itself if
B. 8.12% invested at 5% compounded annually?
C. 8.16% A. 13.7 years
D. 8.24% B. 14.2 years
C. 14.7 years
507. Find the nominal rate, which if
converted quarterly could be used instead of
D. 15.3 years
12% compounded semi-annually.
A. 11.83% 516. What is the corresponding effective interest
B. 11.09% rate of 18% compounded semi-monthly? A. 19.35%
C. 11.65% B. 19.84%
D. 11.25% C. 19.48%
D. 19.64%
What is the effective rate of 14%
508. Which of these gives the lowest effective rate of
compounded semi-annually? A.
interest?
14.49%
A. 12.35% compounded annually B. 14.59%
B. 11.90% compounded semi-annually C. 14.69%
C. 12.20% compounded quarterly D. 14.79%
D. 11.60% compounded monthly
517. At an interest rate of 10% compounded
509. Find the compound amount if P2,500 is annually, how much will a deposit of P1,500 be in 15
invested at 8% compounded quarterly for 5 years years?
and 6 months. A. P6,265.87
A. P3,864.95 B. P6,256.78
B. P3,846.59 C. P6,526.87
D. P6,652.78
C. P3,889.95
D. P3,844.95
518. A man expects to receive P25,000 in 8
An amount of P1,000 becomes P1,608.44 after 4 years compounded
years. How much is that money worth now
bimonthly. Find the nominal interest.
considering interest at 8% compounded
A. 11.89%
quarterly?
B. 12.00%
A. P13,256.83
C. 12.08%
B. P13,655.28
D. 12.32% C. P13,625.83
D. P13,265.83
510. If P5,000 shall accumulate for 10 years at
8% compounded quarterly, then what is the 519. About how many years will P100,000
compound interest at the end of 10 years? earn a compound interest of P50,000 if the
A. P6,080.40 interest rate is 9% compounded quarterly?
B. P6,020.40
A. 4 years
C. P6,040.20
D. P6,060.20 B. 5 years
C. 6 years
511. What is the corresponding D. 7 years
effective rate of 18% compounded semi-
quarterly? A. 19.24% 520. Compute the equivalent rate of 6%
B. 19.48% compounded semi-annually to a rate compounded
C. 19.84% quarterly.
D. 19.92% A. 5.12%
B. 5.96%
512. Find the present worth of a future payment of C. 5.78%
P100,000 to be made in 10 years with an interest of 12% D. 6.12%
 C. 11 years
521. What is the amount of D. 12 years
P12,800 in 4 years at 5%
compounded quarterly? A. 529. A student plans to deposit P1,500.00 in the
P15,461.59 bank now and another P3,000.00 for the next 2 years. If
B. P15,146.95 he plans to withdraw P5,000.00 three years from after his
C. P15,641.59 last deposit for the purpose of buying shoes, what will be
D. P15,614.59 the amount of money left in the bank after one year of
his withdrawal? Effective annual interest rate is 10%.
522. By the condition of a will, the sum of
A. P1,549.64
P20,000 is left to a girl to be held in trust fund by her
B. P1,459.64
guardian until it amounts to P50,000. When will the
C. P1,345.98
girl receive the money if the fund is invested at 8%
D. P1,945.64
compounded quarterly?
A. 11.23 years 530. How much must be invested on
B. 11.46 years January 1, 1998 in order to accumulate P2,000 on
C. 11.57 years January 1, 2003? Money is worth 6%.
D. 11.87 years A. P1,509.34
B. P1,249.64
523. If P50,000 shall accumulate for 10 C. P1,378.98
years at 4% compounded quarterly, find the D. P1,494.52
compounded interest at the end of 10 years. A nominal interest of 3% compounded continuously is given on the
A. P2,333.32 account. What is the accumulated amount of P10,000 after 10
B. P2,444.32 years?
C. P2,555.32 A. P13,498.59
D. P2,666.32 B. P13,489.59
A sum of P1,000 is invested now and left for eight years, at which C. P13,789.98
time the principal is withdrawn. The interest has accrued is left D. P13,494.52
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.
531. A mechanical engineer wishes to accumulate
A. P693.12
a total of P10,000 in a savings account at the end of 10
B. P700.12 years. If the bank pays only 4% compounded quarterly,
C. P702.15 what should be the initial deposit?
D. P705.42 A. P6,176.35
B. P6,761.35
524. P1,500.00 was deposited in a bank account, C. P6,716.53
20 years ago. Today, it is worth P3,000.00. Interest is D. P6,167.35
paid semi-annually. Determine the interest rate paid
on this account. 532. Funds are deposited in a savings account at
A. 2.9% an interest of 8% per annum. What is the initial
B. 3.0% amount that must be deposited to yield a total of
C. 3.2% P10,000 in 10 years?
D. 3.5% A. P4,196.30
B. P4,721.39
525. A merchant puts in his P2,000.00 to a small C. P4,796.03
business for a period of six years. With a given interest D. P4,631.93
rate on the investment of 15% per year, compounded
annually, how much will he collect at the end of the sixth 533. If P500,000 is deposited at a rate of
year? 11.25% compounded monthly, determine the
A. P4,626.12 compounded interest after 7 years and 9 months.
B. P4,262.12 A. P690,848.73
C. P4,383.12
B. P670,651.23
D. P4,444.12
C. P680,649.56
D. P685,781.25
526. A man borrowed P100,000 at the
interest rate of 12% per annum, compounded
534. An interest rate is quoted as being 7.5%
quarterly. What is the effective rate?
compounded quarterly. What is the effective annual
A. 12.75% interest rate?
B. 12.55% A. 7.91%
C. 12.45% B. 7.51%
D. 12.35% C. 7.71%
D. 7.31%
527. Mandarin Bank advertises 9.5% account that
yields 9.84% annually. Find how often the interest is 535. You borrow P3,500.00 for one year from a
compounded. friend at an interest rate of 1.5% per month instead of
A. Monthly taking a loan from a bank at a rate of 18% per year.
B. Bimonthly How much lesser you will pay by borrowing the money
C. Quarterly from the bank?
A. P53.89
D. Annually
B. P54.66
C. P53.78
528. When will an amount be tripled with an interest D. P54.98
of 11.56%?
A. 9 years 536. A deposit of P1,000 is made in a bank
B. 10 years account that pays 8% interest compounded
 annually. Approximately how much money will A. 7.42 years
be in the account after 10 years? B. 7.67 years
A. P2,187.39
B. P2,145.78
C. 7.85 years
C. P2,176.45 D. 7.98 yearsP200,000 was deposited at an interest rate of
D. P2,158.92 24% compounded semi-annually. After how many years
will the sum be P621,170?
537. Fifteen years ago P1,000.00 was E. 4 years
deposited in a bank account, and today it is worth F. 5 years
P2,370.00. The bank pays interest semi-annually. G. 6 years
What was the interest rate paid in this account? H. 7 years
A. 5.72%
B. 5.78% 544. In year zero, you invest P10,000.00 in a 15%
C. 5.84% security for 5 years. During that time, the average
D. 5.90% annual inflation is 6%. How much, in terms of year zero
P200,000 was deposited on January 1, 1988 at an interest rate pesos will be in the account at maturity?
of 24% compounded semi-annually. How much would the sum A. P15,030.03
be on January 1, 1993? B. P20,113.57
A. P631,627.78 C. P18,289.05
B. P612,890.76 D. P16,892.34
C. P621,169.64
D. P611,672.18 545. A company invests P10,000 today to
be repaid in 5 years in one lump sum at 12%
538. What is the present worth of two P100 compounded annually. How much profit in
payments at the end of the third year and fourth year? present day pesos is realized?
The annual interest rate is 8%. A. P7,563.29
A. P150.56 B. P7,498.20
B. P152.88 C. P7,340.12
C. P153.89 D. P7,623.42
D. P151.09
546. How long (in nearest years) will it take money
539. Consider a deposit of P600.00 to be paid back to quadruple if it earns 7% compounded semi-
in one year by P700.00. What is the rate of interest, i% annually?
per year compounded annually such that the net present A. 20 years
worth of the investment is positive? Assume i ≥ 0. B. 18 years
A. 16.50% C. 21 years
B. 16.75%
D. 19 years
C. 16.33%
D. 16.67%
547. How much should you put into a 10% savings
account in order to have P10,000.00 in five years?
540. A firm borrows P2,000 for 6 years at 8 %. At
A. P6,216.21
the end of 6 years, it renews the loan for the amount B. P6,212.12
due plus P2,000 more for 2 years at 8%. What is the
C. P6,218.21
lump sum due? D. P6,209.21
A. P3,260.34
B. P3,280.34 548. A man expects to receive P20,000 in 10
C. P3,270.34 years. How much is that money worth now
D. P3,250.34 considering interest at 6% compounded quarterly?
A. P11,042.89
541. A machine has been purchased and installed B. P11,035.12
at a total cost of P18,000.00. The machine will retire at C. P11,025.25
the end of 5 years, at which time it is expected to have D. P11,012.52
a scrap value of P2,000.00 based on current prices. The
machine will then be replaced with an exact duplicate. 549. P500,000 was deposited 20.15 years ago at
The company plans to establish a reserve funds to an interest rate of 7% compounded semi- annually.
accumulate the capital needed to replace the machine. How much is the sum now?
If an average annual rate of inflation of 3% is A. P2,000,033.33
anticipated, how much capital must be accumulated? B. P2,000,166.28
A. P18,854.38 C. P2,001,450.23
B. P18,548.38 D. P2,002,820.12
C. P18,458.38
D. P18,845,38 550. A bank pays one percent interest on
savings accounts four times a year. What is the
542. What is the effective rate corresponding to effective annual interest rate?
16% compounding daily? Take 1 year = 360 days. A. 4.06%
A. 17.35% B. 4.12%
B. 17.45%
C. 4.16%
C. 17.55% D. 4.28%
D. 17.65% Alexander Michael owes P25,000.00 due in 1 year and P75,000 due in
4 years. He agrees to pay P50,000.00 today and the balance in 2 years.
543. By the condition of a will, the sum of P25,000 How much must he pay at the end of two years if money is worth 5%
is left to a girl to be held in a trust fund by her guardian compounded semi-annually?
until it amounts to P45,000. When will the girl receive A. P39,015.23
the money if the fund is invested at 8% compounded B. P39,026.25
quarterly? C. P39,056.21
 D. P39,089/78 to cost P300,000 and at the end of 5 years, an
extension to be added to cost P200,000.
551. Find the difference between simple interest By how much is proposal B more economical
and compound interest on a savings deposit of P50,000 at than proposal A if interest rate is 20% and
10% per annum for 3 years. depreciation is to be neglected?
A. P1,510 A. P19,122.15
B. P1,530 B. P19,423.69
C. P1,550 C. P19,518.03
D. P1,570 D. P19,624.49

552. If money is worth 5% compounded quarterly, 558. A credit plan charges interest rate of 36%
find the equated time for paying a loan of P150,000 due compounded monthly. Find its effective rate. A. 42.21%
in 1 year and P280,000 due in 2 years. B. 42.30%
A. 1.52 years C. 42.41%
B. 1.64 years D. 42.57%
C. 1.69 years
D. 1.72 years 559. A master card compounds monthly and
charges an interest of 1.5% per month. What is the
effective interest rate per year?
553. For a loan acquired six years ago, a man paid
A. 19.23%
out the amount of P75,000.00. The interest was
B. 19.45%
computed at 18% compounded annually. How much was
C. 19.56%
the borrowed amount?
D. 19.65%
A. P27,367.28
B. P27,278.36 560. A man expects to receive
C. P27,782.36 P20,000 in 10 years. If interest is
D. P27,872.63 computed at 6% compounded quarterly,
how much is it worth today?
554. A couple decided that for every child that will A. P11,025.25
be born to them they will place a deposit in the bank so B. P11,035.25
that on the child’s 18th birthday, the child will receive C. P11,045.25
the amount of P300,000.00. If the bank will pay an D. P11,055.25
interest of 18% compounded yearly, how much deposit
will the couple have to make on the birth of a child to 561. Microsoft CEO, billionaire Bill Gates willed
them? that a sum of $25 million be given to a child but will be
A. P15,367.18 held in trust by the child’s mother until it amounts to
B. P15,249.13 $45 million. If the amount is invested and earns 8%
C. P15,722.16 compounded quarterly, when will the child receive the
D. P15,482.64 money?
A. 8.11 years
555. On his 6th birthday a boy is left an inheritance. B. 7.90 years
The inheritance will be paid in a lump sum of P10,000 on C. 7.42 years
his 21st birthday. What is the present value of the D. 7.24 years
inheritance as of the boy’s 6th birthday, if the interest is
compounded annually? Assume i = 4%.
A. P5,552.64
562. Find the present value of installment
payments of P1,000 now, P2,000 at the end of the first
B. P5,549.10
year, P3,000 at the end of the second year, P4,000 at
C. P5,522.12
the end of the third year and P5,000 at the end of the
D. P5,582.63
fourth year, if money is worth 10% compounded
annually.
556. A man who won P300,000 in a lottery decided A. P11,411.10
to place 50% of his winning in a trust fund for the college
B. P11,530.98
education of his son. If the money will earn 14% per year
compounded quarterly, how much will the man have at C. P11,621.67
the end of 10 years when his son will be starting his D. P11,717.85
college education? How long will it take money to triple itself if invested at 8%
A. P593,120.12 compounded annually?
B. P593,452.12 A. 14.27 years
C. P592,739.96 B. 14.56 years
D. P593,888.96 C. 14.78 years
If the sum of P15,000 is deposited in an account earning 4% per
annum compounded quarterly, what will be the deposited
D. 14.98 years
amount at the end of 5 years?
A. P18,302.85 563. Two hundred years ago, your great, great,
B. P18,450.89 great grandfather deposited P1 in a savings account.
Today, the bank notified you that you are the sole heir
C. P18,512.83
to this account. How much is the account today if it
D. P18,638.29 earns 8% per annum?
A. P4,002,450.78
557. The Philippine Society of Mechanical B. P4,102,405.90
Engineers is planning to put up its own building. Two C. P4,838,949.58
proposals being considered are: D. P4,909,289.45

a. The construction of the building now to cost 564. What is the present worth of a future payment
P400,000. of P200,000 to be made in 10 years with an interest of
10% compounded annually?
b. The construction of a smaller building now A. P76,901.21
 B. P77,108.66 P100,000 today to be repaid in five years in one lump
C. P78,109.32 sum at 12% compounded annually. If the rate of
D. P79,667.32 inflation is 4% compounded annually, how much
profit, in today’s pesos, is realized over the five-year
565. A deposit of P1,000.00 is made in a bank period?
account that pays 8% interest compounded annually. A. P44,512.89
How much money will be in the account after 10 B. P44,672.10
years? C. P44,851.64
A. P2,374.21 D. P44,901.23
B. P2,158.92
C. P2,734.12 573. A manufacturing firm contemplates retiring an
D. P2,400.12 existing machine at the end of 2002. The new machine
to replace the existing one will have an estimated cost of
566. What nominal rate compounded annually P400,000. This expense will be partially defrayed by the
would quadruple the principal in 4 years? A. 41.42% sale of the old machine as scrap for P30,000. To
B. 40.81% accumulate the balance of the required capital, the firm
C. 41.79% will deposit the following sum in an account earning
D. 40.45% interest at 5% compounded quarterly:

P
567. Five years ago, you paid P34,000 for a
6
residential lot. Today you sell it at P50,000. What is your
0
annual rate of appreciation?
,
A. 8.12%
0
B. 8.00%
0
C. 7.92%
0
D. 8.32%
a
568. Suppose that P100,000 is invested at a certain t
rate of interest compounded annually for 2 years. If the
accumulated interest at the end of 2 years is P21,000. t
Find the rate of interest. h
A. 10.12% e
B. 10.00%
C. 10.92% e
D. 10.32% n
d
569. An investment of P20,000 will be required
at the end of the year. The project would terminate o
at the end of the 5th year and the assets are f
estimated to have a salvage value of P25,000 at
that time. What is the rate of interest for this 1
project to break even? 9
A. 5.74% 9
B. 5.43% 9
C. 5.91%
P
D. 5.67% 6
Robin Padilla possesses a promissory note, due in 2 years hence, 0
whose maturity value is P3,200. What is the discount value of this ,
note, based on an interest rate of 7%? 0
A. P2,795.00 0
B. P2,975.00 0
C. P2,579.00
D. P2,759.00 a
t
570. JM borrowed a certain amount on June 1990
from DJ. Two years later, JM borrowed again from DJ an t
amount of P5,000. JM paid P1,000 on June 1993 and h
discharged his balance by paying P7,500 on June 1995. e
What was the amount borrowed by JM on June 1990 if
the interest is 8% compounded annually? e
A. P1,511.61 n
B. P1,611.51 d
C. P1,711.41
D. P1,811.31 o
f
571. Dr. Gary Sy invests P50,000 in a time deposit
2
that yields 10% for his retirement 30 years from now. If
0
the inflation rate is 5%, what will be the value of the
0
account at maturity in terms of today’s peso.
0
A. P201,689.91
B. P201,571.91
P
C. P201,345.91
8
D. P201,869.91
0
,
572. First Benchmark Publisher Inc. invests 0
 0
0 575. What interest rate, compounded
monthly, is equivalent to a 10% effective rate?
a A. 9.45%
t B. 9.26%
C. 9.65%
t
h D. 9.56%
e Froyd Wess Network Inc. plans to purchase a piece of land and to
build a school building on this land. However, since the school
e building is not an immediate requirement, the institute is
n considering whether it should purchase this land and build the
d building now or defer this action for 3 years. The current costs are as
follows:
o
f Land: P800,000 Building: P12,000,000

2 The purchase price of the land and the cost of the school
0 building are expected to appreciate at the rate of 15%
0 and 4% per annum, respectively. What will be the total
1 cost of the land and structure 3 years hence?
A. P14,520,120
What cash disbursement will be necessary at the end B. P14,715,068
of 2002 to purchase the new machine? A. C. P14,902,189
P155,890.12 D. P15,021,781
B. P153,085.56
576. Mr.
C. P154,200.12
D. P156,930.38
On June 1, 1998, Ms. Brenda Marcial purchased stock of San Jimenez owes
Miguel Corporation at a total cost of P144,000. She then
received the following semiannual dividends: Mr. Padua

P4,200 on December 1, 1998

the following
P4,400 on June 1, 1999
P4,400 on December 1, 1999
P4,000 on June 1, 2000 amounts:

After receiving the last dividend, Ms. Marcial sold her P40,000 due
stock, receiving P152,000 after deduction of brokerage
fees. What semiannual rate did this dividend realize on
her investment? 2 years hence
A. 4.26% P60,000 due 3 years hence
B. 4.54% P72,000 due 4 years hence
C. 4.87%
D. 4.91% Having won the lottery, Mr. Jimenez decided to
liquidate the debts at the present time. If the two
574. Engr. Narito has P13,760 in cash and he would parties agree on a 5% interest rate, what sum must
like to invest it in business. His estimates of the year-by- Mr. Jimenez pay?
year receipts and disbursements for all purposes are A. P147,520.20
shown in the tabulation below: B. P147,346.02
C. P147,902.89
Year Receipts D.Disbursements
P147,021.81
0 0 - P13,760
577. Mr. John Bongat working in the United States
planned of returning to the Philippines at the end of
2001. He established a fund starting in 1995 with the
following recorded deposits and withdrawals.
4 P5,000 + P1,000
January 1, 1995 Deposit of P40,000
January 1, 1997 Deposit of P80,000
5 P6,200 + P1,200
July 1, 1997 Withdrawal of P12,000
July 1, 1998 Deposit of P64,000
January 1, 1999 Withdrawal of P48,000
6 P7,500 + P1,500
His fund earned interest at the rate of 3.5% compounded
semiannually until the end of 1997. At that date, the
interest was augmented to 4% compounded
7 P8,800 semiannually.
+ P1,800 What will be the principal in the fund at
the end of 2001?
He estimates that his equipment will have a salvage A. P146,323.08
value of P2,000 at the end of useful life. Find the B. P146,992.99
rate of return of the prospective equipment. C. P146,846.92
A. 10.11% D. P146,022.82
B. 11.80% JRT Publishers is contemplating of installing a labor-saving printing
C. 11.10% equipment. It has a choice between two different models. Model
D. 10.51% A will cost P1,460,000 while model B will cost P1,452,000. The
anticipated repair costs for each model are as follows: be accrued if the publisher will purchase the more
economical model?
M A. P8,769.18
o B. P8,918.23
d C. P9,012.53
e
D. P9,341.11
l

A 578. What is the future amount of P50,000 if the

: single payment compound amount factor of this
investment is 1.23%
P A. P61,700
6 B. P61,900
0 C. P61,200
, D. P61,500
0
0 579. An investment indicates a single compound
0 amount factor of 1.32 if invested for “n”
years. If the interest rate is 4.73% per annum, find the
a
t value of “n.”
A. 4
t B. 5
h C. 6
e
D. 7
e
n 580. Mr. Mondragon invests P50,000 today. Several
d years later, it becomes P60,000. What is the single
payment present worth factor of this investment? If the
o amount was invested for 5 years, what is the rate of
f interest?
A. 3.1%
5 B. 3.3%
t C. 3.5%
h D. 3.7%

y 581. Money is deposited in a certain

e account for which the interest is
a
compounded continuously. If the balance
r
doubles in 6 years, what is the annual
percentage rate?
P
A. 11.55%
8
B. 11.66%
0
C. 11.77%
,
D. 11.88%
0
0
0 582. On January 1, 1999, Ms. Angel Locsin
opened an account at Bank of Philippine Islands with
a an initial deposit of P1,000,000.00. On March 1, 2000,
t she opened an additional P1,000,000.00. If the bank
pays 12% interest compounded monthly, how much
t will be in the account on April 1, 2000?
h A. P2,180,968.95
e B. P2,190,968.95
C. P2,160,968.95
e D. P2,170,968.95
n What is the present worth of a P500 annuity starting at the end
d of the third year and continuing to the end of the fourth year, if
the annual interest rate is 10%?
o A. P727.17
f B. P717.17
C. P714.71
1 D. P731.17
0
t 583. Today, a businessman borrowed money to be
h paid in 10 equal payments for 10 quarters. If the interest
rate is 10% compounded quarterly and the quarterly
y payment is P2,000, how much did he borrow?
e A. P17,304.78
a B. P17,404.12
r C. P17,504.13
D. P17,604.34
Model B: P152,000 at the end of 9th year What annuity is required over 12 years to equate with a future
amount of P20,000?
The two models are alike in all other respects. If the A
publisher is earning a 7% return of its capital, which s
model should be purchased? How much savings will s
 u
m P
e 5
0
i 0
.
= 0
0
6
% C
o
a s
n t
n
u o
a f
l
l d
y y
. e

A =
.
P
P 1
1 ,
, 2
2 0
9 0
0 .
. 0
3 0
4 Salvage value of dye = P600.00
B. P1,185.54
C. P1,107.34 The money will be deposited in a savings account
which earns 6% interest. Determine the sum of money
D. P1,205.74
that must be provided, including the cost of the initial
dye.
584. Find the annual payment to extinguish a
debt of P10,000 payable for 6 years at 12% interest A. P8,626.02
annually. B. P8,662.02
A. P2,324.62 C. P8,226.02
B. P2,234.26 D. P8,666.22
C. P2,432.26
D. P2,342.26 586. A factory operator bought a diesel generator
set for P10,000.00 and agreed to pay the dealer
585. A manufacturer desires to set aside a uniform sum at the end of each year for 5 years at 8%
certain sum of money to provide funds to cover the interest compounded annually, that the final payment
yearly operating expenses and the cost of replacing will cancel the debt for principal and interest. What is
every year the dyes of a stamping machine used in the annual payment?
making radio chassis as model changes for a period of A. P2,500.57
10 years. B. P2,544.45
C. P2,540.56
O D. P2,504.57
p
e
587. A man paid 10% downpayment of P200,000
r
for a house and lot and agreed to pay the 90% balance
a
on monthly installment for 60 months at an interest
t
rate of 15% compounded monthly. Compute the
i
amount of the monthly payment.
n
A. P42,821.86
g
B. P42,128.67
C. P42,218.57
c
D. P42,812.68
o
s
t 588. What is the present worth of a 3 year annuity
paying P3,000.00 at the end of each year, with interest
p at 8% compounded annually?
e A. P7,654.04
r B. P7,731.29
C. P7,420.89
y D. P7,590.12
e What is the accumulated amount of five-year annuity paying
a P6,000 at the end of each year, with interest at 15% compounded
r annually?
A. P40,519.21
= B. P40,681.29
C. P40,454.29
 D. P40,329.10 596. A company issued 50 bonds of P1,000.00 face
value each, redeemable at par at the end of 15 years to
589. A debt of P10,000 with 10% interest accumulate the funds required for redemption. The firm
compounded semi-annually is to be amortized by established a sinking fund consisting of annual deposits,
semi-annual payment over the next 5 years. The first the interest rate of the fund being 4%. What was the
due in 6 months. Determine the semi- annual principal in the fund at the end of the 12th year?
payment. A. P38,120.00
A. P1,234.09 B. P37,520.34
B. P1,255.90 C. P37,250.34
C. P1,275.68 D. P37,002.00
D. P1,295.05
597. A house and lot can be acquired by a
590. A man borrowed P300,000 from a lending downpayment of P500,000 and a yearly payment of
institution which will be paid after 10 years at an interest P100,000 at the end of each year for a period of 10 years,
rate of 12% compounded annually. If money is worth 8% starting at the end of 5 years from the date of purchase.
per annum, how much should he deposit to a bank If money is worth 14% compounded annually, what is the
monthly in order to discharge his debt 10 yrs. hence? cash price of the property?
A. P5,174.23 A. P806,899.33
B. P5,162.89 B. P807,100.12
C. P5,190.12 C. P807,778.12
D. P5,194.23 D. P808,835.92

591. A man loans P187,400 from a bank with 598. A parent on the day the child is born wishes to
interest at 5% compounded annually. He agrees to pay determine what lump sum would have to be paid into an
his obligations by paying 8 equal annual payments, the account bearing interest at 5% compounded annually, in
first being due at the end of 10 years. Find the annual order to withdraw P20,000 each on the child’s 18th, 19th,
payments. 20th and 21st birthdays. How much is the lump sum
A. P43,600.10 amount?
B. P43,489.47 A. P30,119.73
C. P43,263.91 B. P30,941.73
D. P43,763.20 C. P30,149.37
D. P30,419.73
592. Money borrowed today is to be paid in 6 equal
payments at the end of 6 quarters. If the interest is 12% 599. An instructor plans to retire in exactly one
compounded quarterly, how much was initially year and want an account that will pay him P25,000 a
borrowed if quarterly payment is P2,000.00? year for the next 15 years. Assuming a 6% annual
A. P10,834.38 effective interest rate, what is the amount he would
B. P10,278.12 need to deposit now? (The fund will be depleted after
C. P10,450.00 15 years).
D. P10,672.90 A. P242,860.22
B. P242,680.22
593. A person buys a piece of lot for P100,000 C. P242,608.22
downpayment and 10 deferred semi-annual payments D. P242,806.22
of P8,000 each, starting three years from now. What
is the present value of the investment if the rate of 600. A manufacturing firm wishes to give each 80
interest is 12% compounded semi-annually? employees a holiday bonus. How much is needed to
A. P142,999.08 invest monthly for a year at 12% nominal interest rate
B. P143,104.89 compounded monthly, so that each employee will
C. P142,189.67 receive a P2,000 bonus?
D. P143,999.08 A. P12,615.80
B. P12,516.80
594. How much must you invest today in order C. P12,611.80
to withdraw P2,000 annually for 10 years if the D. P12,510.80
interest rate is 9%? A man purchased on monthly installment a P100,000 worth of
A. P12,835.32 land. The interest rate is 12% nominal and payable in 20 years.
B. P12,992.22 What is the monthly amortization?
C. P12,562.09 A. P1,101.08
D. P12,004.59 B. P1,202.08
How much must be deposited at 6% each year beginning on C. P1,303.08
January 1, year 1, in order to accumulate P5,000 on the date of
D. P1,404.08
the last deposit, January 1, year 6?
A. P728.99
B. P742.09 601. A young engineer borrowed P10,000 at 12%
interest and paid P2,000 per annum for the last 4 years.
C. P716.81
What does he have to pay at the end of the fifth year in
D. P702.00 order to pay off his loan?
A. P6,999.39
595. A piece of machinery can be bought for B. P6,292.93
P10,000 cash or for P2,000 down and payments of P750 C. P6,222.39
per year for 15 years. What is the annual interest rate D. P6,922.93
for the time payments?
A. 4.61% 602. An investment of P350,000 is made today
B. 4.71% and is equivalent to payments of P200,000 each year
C. 4.41% for 3 years. What is the annual rate of return on
D. 4.51% investment for the project?
A. 32.7%
 B. 33.8%
C. 33.2%
D. 33.6%

603. Maintenance cost of an equipment is P200,000

for 2 years, P40,000 at the end of 4 years and P80,000 at
the end of 8 years. Compute the semi-annual amount
that will be set aside for this equipment. Money worth
10% compounded annually.
A. P7,425.72
B. P7,329.67
C. P7,245.89
D. P7,178.89

604. Mr. Cruz plans to deposit for the education of

his 5 years old son, P500 at the end of each month for
10 years at 12% annual interest compounded monthly.
The amount that will be available in two years is:
A. P13,100.60
B. P13,589.50
C. P13,982.80
D. P13,486.70

605. A small machine has an initial cost of P20,000,

a salvage value of P2,000 and a life of 10 years. If your
cost of operation per year is P3,500 and your revenues
per year is P9,000, what is the approximate rate of
return (ROR) on the investment?
A. 24.2%
B. 24.8%
C. 25.1%
D. 25.4%

606. An employee is about to receive the sum of

P300.00 at the end of each year for 5 years.
One year prior to the receipt of the first sum, he
decides to discount all 5 sum. If the interest rate is
6%, what proceeds will he obtain?

A. P1,298.00
B. P1,231.09
C. P1,221.62
D. P1,263.71
 607. The president of a growing engineering A. 3.15
firm wishes to give each of 50 employees a holiday B. 1.75
bonus. How much is needed to invest monthly for C. 2.15
a year at 12% nominal rate compounded monthly, D. 2.75
so that each employee will receive a P1,000.00
bonus?
614. A machine costs P20,000.00 today and has an
A. P3,942.44
estimated scrap value of P2,000.00 after 8 years. Inflation
B. P3,271.22 is 2% per year. The effective annual interest rate earned
C. P3,600.12 on money invested is 8%. How much money needs to be
D. P3,080.32 set aside each year to replace the machine with an
identical model 8 years from now?
608. Mr. Padilla plans a deposit of P500 at the end A. P3,345.77
of each month for 10 years at 12% annual interest, B. P3,389.32
compounded monthly. What will be the amount that C. P3,489.11
will be available in 2 years? D. P3,573.99
A. P13,941.44
B. P13,272.22
615. Engr. Santos borrows P100,000.00 at 10%
C. P13,486.73
effective annual interest. He must pay back the loan over
D. P13,089.32
30 years with uniform monthly payment due on the first
day of each month. What does Engr. Santos pay each
609. Mr. Ramirez borrowed P15,000 two years month?
ago. The terms of the loan are 10% interest for 10 A. P838.86
years with uniform payments. He just made his B. P849.12
second annual payment. How much principal does he C. P850.12
still owe? D. P840.21
A. P13,841.34
B. P13,472.22
616. Instead of paying P100,000.00 in annual rent for
C. P13,286.63
office space at the beginning of each year for the next 10
D. P13,023.52
years, an engineering firm has decided to take out a 10-
year P1,000,000.00 loan for a new building at 6% interest.
610. A man inherited a regular endowment of The firm will invest P100,000.00 of the rent saved and
P100,000 every end of 3 months for 10 years. However, earn 18% annual interest on that amount. What will be
he may choose to get a single lump sum payment at the the difference between the firm’s annual revenue and
end of 4 years. How much is this lump sum of the cost expenses?
of money is 14% compounded quarterly? A. P10,200.12
A. P3,702,939.73 B. P10,205.13
B. P3,607,562.16 C. P10,210.67
C. P3,799,801.23 D. P10,215.56
D. P3,676,590.12
617. A service car whose cash price was
611. A man paid 10% down payment of P200,000 P540,000 was bought with a downpayment of
for a house and lot and agreed to pay the balance on P162,000 and monthly installment of P10,874.29 for
monthly installments for “x” years at an interest rate of 5 years. What was the rate of interest if
15% compounded monthly. If the monthly installment compounded 5monthly?
was P42,821.87, find the value of x? A. 20%
A. 3 B. 24%
B. 4 C. 21%
D. 23%
C. 5
D. 6 618. What uniform annual amount should be
deposited each year in order to accumulate
612. You need P4,000 per year for four years to go P100,000.00 at the end of the 5th annual deposit if
to college. Your father invested P5,000 in 7% account money earns 10% interest?
for your education when you were born. If you A. P16,002.18
withdraw P4,000 at the end of your 17th, 18th, 19th B. P15,890.12
and 20th birthday, how much will be left in the account C. P16,379.75
at the end of the 21st year? D. P15,980.12
A. P1,666.98 In five years, P18,000 will be needed to pay for a building
B. P1,699.86 renovation. In order to generate this sum, a sinking fund consisting
C. P1,623.89 of three annual payments is established now. For tax purposes, no
D. P1,645.67 further payment will be made after three years. What payments are
necessary if money worth 15% per annum?
613. Mr. Ayala borrows P100,000 at 10% effective A. P3,919.52
annual interest. He must pay back the loan over 30 years B. P3,871.23
with uniform monthly payments due on the first day of C. P3,781.32
each month. What does Mr. Ayala pay each month? D. P3,199.52
A. P839.19
B. P842.38 619. Find the present value in pesos, of a
C. P807.16 perpetuity of P15,000 payable semi-annually if
D. P814.75 money is worth 8% compounded quarterly.
A machine is under consideration for investment. The cost of the A. P371,719.52
machine is P25,000.00. B. P371,287.13
Each year it operates, the machine will generate a C. P371,670.34
savings of P15,000.00. Given the effective annual D. P371,802.63
interest rate of 18%, what is the discounted payback
period, in years, on the investment of the machine? 620. If P500.00 is invested at the end of each
 year for 6 years, at an annual interest rate of 7%, C. P43,102.23
what is the total peso amount available upon the D. P43,189.03
deposit of the sixth payment?
A. P3,671.71 623. A man inherited a regular endowment of
B. P3,712.87 P100,000.00 every end of 3 months for x years. However,
C. P3,450.12 he may choose to get a single lump sum of P3,702,939.80
D. P3,576.64 at the end of 4 years. If the rate of interest was 14%
compounded quarterly, what is the value of x?
621. How many years must you invest today in A. 10
order to withdraw P1,000.00 per year for 10 years if
the interest rate is 12%?
B. 11
A. P5,467.12
C. 12
B. P5,560.22 D. 13
C. P5,650.22
D. P5,780.12 624. If you obtain a loan of P1M at the rate of 12%
compounded annually in order to build a house, how
622. A man paid a 10% down payment of P200,000 much must you pay monthly to amortize the loan
for a house and lot and agreed to pay the balance on within a period of 10 years?
monthly installments for 5 years at an interest rate of A. P13,994.17
15% compounded monthly. B. P14,801.12
W C. P13,720.15
h D. P14,078.78
a Rej Averion borrowed P50,000.00 from Social Security System, in
t the form of calamity loan, with interest at 8% compounded
quarterly payable in equal quarterly installments for 10 years.
w Find the quarterly payments.
a A. P1,590.83
s B. P1.609.23
C. P1,778.17
t D. P1,827.79
h
e 625. For having been loyal, trustworthy and
efficient, the company has offered a supervisor a yearly
m gratuity pay of P20,000.00 for 10 years with the first
o payment to be made one year after his retirement. The
n supervisor, instead, requested that he be paid a lump
t sum on the date of his retirement less interact that the
h company would have earned if the gratuity is to be paid
l on the yearly basis. If interest is 15%, what is the
y equivalently lump sum that he could get?
A. P100,357.37
i
B. P100,537.73
n
s C. P100,375.37
t D. P100,735.37
a
l 626. In anticipation of a much bigger volume of
l business after 10 years, a fabrication company
m purchased an adjacent lot for its expansion program
e where it hopes to put up a building projected to cost
n P4,000,000.00 when it will be constructed 10 years
t after, To provide the required capital expense, it plans
to put up a sinking fund for the purpose. How much
i must the company deposit each year if interest to be
n earned is computed at 15%?
A. P194,089.17
p B. P195,780.12
e C. P196,801.56
s D. P197,008.25
o
s
?
627. A man purchased a car with a cash price of
P350,000. He was able to negotiate with the seller to
allow him to pay only a downpayment of 20% and the
A
balance payable in equal 48 end of the month installment
.
at 1.5% interest per month. Once the day he paid the
20th installment, he decided to pay monthly payment.
P
How much is his monthly payment?
4
A. P8,929.29
2
B. P8,225.00
,
8 C. P8,552.00
2 D. P8,008.20
1
. 628. A man purchased a car with a cash price of
8 P350,000. He was able to negotiate with the seller to
7 allow him to pay only a downpayment of 20% and the
B. P42,980.00 balance payable in equal 48 end of the month installment
 at 1.5% interest per month. Once the day he paid the
20th installment, he decided to pay monthly payment.
What is the remaining balance that he paid?
A. P186,927.24
B. P188,225.00
C. P187,701.26
D. P185,900.20

629. A company purchased for a cash price of

P500,000.00 a machine which is estimated to have a
salvage value of P50,000.00 at the end of its 10 years
economic life. How much yearly deposit must the
company deposit in a sinking fund that will pay 18%
interest, compounded yearly, to accumulate the needed
fund to purchase the new machine at the end of the 10th
year economic life of the machine it purchased if a new
machine will cost 75% more by that time?
A. P34,859.78
B. P35,890.12
C. P35,074.58
D. P34,074.85
 630. A car dealer advertises the sale of a car model
for a cash price of P280,000. If purchased on installment, 635. Mr. Juan dela Cruz borrows P100,000 at 10%
the regular downpayment is 15% and balance payable in compounded annually, agreeing to repay the loan in
18 equal monthly installments at an interest rate of 1.5% twenty equal annual payments. How much of the
per month. How much will be required monthly original principal is still unpaid after he has made the
payments? tenth payment?
A. P15,185.78 A. P69,890.42
B. P15,289.12 B. P72,000.80
C. P72,173.90
C. P15,783.90
D. P72,311.44
D. P15,632.11

631. A machinery supplier is offering a certain

636. A debt of P12,000 with an interest of 20%
compounded quarterly is to be amortized by equal
machinery on a 10% downpayment and the balance
semi-annual payments over the next three years, the
payable in equal end of the year payments without
first due in 6 months. How much is the semi-annual
interest for 2 years. Under this arrangement, the price
payments?
is pegged to be P250,000. However, for cash
purchase, the machine would only cost P195,000. A. P2,775.50
What is the equivalent interest rate that is being B. P2,662.89
charged on the 2- year payment plan if interest is C. P2,590.04
compounded quarterly? D. P2,409.78
A. 18.47%
B. 19.21%
637. A fund donated by a benefactor to PICE to
provide annual scholarships to deserving CE students.
C. 19.47%
The fund will grant P5,000 for each of the first five years,
D. 19.74%
P8,000 for the next five years and P10,000 each year
thereafter. The scholarship will start one year after the
632. A company has approved a car plan for its six fund is established. If the fund earns 8% interest, what is
senior officers in which the company will shoulder 25% of the amount of the donation?
the cost and the difference payable by each officer to a
A. P99,490.00
financing company in 48 equal end of the month
B. P99,507.35
installments at an interest rate of 1.5% per month. If the
C. P99,601.71
cost of each car is P350,000, determine the amount each
D. P99,723.54
officer has to pay the financing company per month?
A. P7,523.90
638. If a low cost house and lot worth P87,000
B. P7,619.22 were offered at 10% downpayment and P500 per month
C. P7,190.00 for 25 years, what is the effective monthly interest rate
D. P7,710.94 on the diminishing balance? A. 0.492%
B. 4.92%
633. If P10,000 is deposited each year for 9 years,
C. 0.0492%
how much annuity can a person get annually from the
D. 49.2%
bank every year for 8 years starting 1 year after the 9th
deposit is made. Cost of money is 14%.
A. P34,467.21 639. The average annual cost of damages caused
B. P34,567.81 by floods at Dona Rosario Village located along
Butuanon river is estimated at P700,000. To build a
C. P34,675.18
gravity dam to protect the area from the floods, would
D. P34,867.37 cost P2,500,000 and would involve an annual
maintenance cost of P20,000. With interest at 8%
634. An employee is earning P12,000.00 a month compounded annually, how many years will it take for
and he can afford to purchase a car which will require a the dam to pay for itself?
downpayment of P10,000.00 and a monthly A. 4.0 years
amortization of not more than 30% of his monthly salary.
What should be the maximum cash value of a car he can
B. 4.5 years
purchase if the seller will agree to a downpayment of C. 5.0 years
P10,000.00 and the balance payable in four years at 18% D. 5.5 years
per year payable on monthly basis? The first payment A businessman borrowed P10,000.00 from a bank at 12% interest,
will be due at the end of the first month? A. P135,267.21 and paid P2,000.00 per annum for the first 4 years. What does he
B. P135,507.42 pay at the end of the fifth year in order to pay-off the loan?
C. P135,605.48 A. P6,812.54
D. P135,807.30 B. P6,782.31
A new company developed a program in which the employees C. P6,917.72
will be allowed to purchase shares of stocks of the company at D. P6,660.90
the end of its fifth year of operation, when the company’s
thought to have gained stability already. The stock has a par 640. Engr. Rodel Narito agreed to pay the loan he
value of P100.00 per share. is borrowing from a development bank in six annual
end-of-the-year payments of P71,477.70. Interest is
Believing in the good potential of the company, an 18% per annum compounded annually and is included
employee decided to save in a bank the amount of in the yearly amount he will be paying the bank. How
P8,000.00 at the end of every year which will earn for much money Engr. Narito is borrowing from the bank?
him 9% interest, compounded annually. A. P250,000
B. P260,000
How much shares of stocks will he be able to purchase C. P270,000
at the end of the fifth year of his yearly deposits?
D. P280,000
A. 476
B. 478
C. 480 641. Rona wishes to purchase a 29-inch flat-
D. 482 screened colored TV at Bodega Appliance Center an
 amount of P20,000.00. She made a downpayment of
P5,000.00 and the balance payable in 24 equal monthly
installments. If financing charge is 12% for each year
computed on the total balance to be paid by installment
and interest rate 12%, how much would Rona pay every
month for the colored TV? What will be the actual cost
of the money?
A. 36.71%
B. 36.21%
C. 35.89%
D. 35.23%

642. Engr. Bacolongan of Main Engineering

decided to purchase a machine which is to be used for
their refrigeration and airconditioning works at an
amount of P1,200,000. The useful life of the machine is
estimated to be 5 years with a salvage value of P80,000
as based on current prices. The average annual rate of
inflation during the next 5 years will be 7%. The
machine will be replaced with a duplicate and the firm
will accumulate the necessary capital by making equal
end-of-year deposits in a reserve fund that earns 6%
per annum. Determine the annual deposit.
A. P277,189.56
B. P278,664.54
C. P279,180.00
D. P280,673.12

643. Engr. Bacolongan of Main Engineering

decided to purchase a machine which is to be used for
their refrigeration and air-conditioning works at an
amount of P1,200,000. The useful life of the machine is
estimated to be 5 years with a salvage value of P80,000
as based on current prices. The average annual rate of
inflation during the next 5 years will be 7%. The
machine will be replaced with a duplicate and the firm
will accumulate the necessary capital by making equal
end-of-year deposits in a reserve fund. If money is
worth 6% per annum, determine the annual deposit.
A. P367,890.12
B. P366,062.33
C. P365,089.34
D. P364,890.43
644. Because of the peso devaluation, a car 0
costing P150,000 is to be purchased through a 1
finance company instead of paying cash. If the buyer
is required to pay P40,000 as downpayment and P
P4,000 each month for 4 years, what is the effective 1
interest rate on the diminishing balance? ,
A. 35.28% 2
0
B. 35.82%
0
C. 34.89% ,
D. 34.29% 0
0
645. Engr. Edwin Astorga plans to purchase a new 0
office building costing P1,000,000. He can raise the
building by issuing 10%, 20-year bond that would pay a
P150,000 interest per year and repay the face amount t
at maturity. Instead of buying the new building, he can
least it for P140,000 per year, first payment being due t
one year from now. The building has an expected life of h
20 years. Ignoring effects on income tax, what is the e
difference between buying the building and leasing the
building? e
A. P233,779.27 n
B. P233,070.12 d
C. P234,070.34
D. P234,560.12 o
f
646. Triple J Construction Firm had put up for
sale of some of their heavy equipments for 2
construction works. There were two interested buyers 0
submitting their respective bids for the heavy 0
equipments. The bids are as follows: 2

Buyer A offers P10,000,000 payable 20% downpayment, P

the balance payable P1,000,000 annually for 8 years. 1
Buyer B offers P9,000,000 payable P2,000,000 down ,
payment, the balance payable P500,000 semi-annually 5
for 7 years. 0
0
How much is the difference between the ,
two bids if money is worth 10% effective? 0
A. P346,520.05 0
B. P346,980.12 0
C. P347,019.45
D. P347,733.29 a
t
647. Froyd Review & Training Center Inc. is
expanding its school facilities starting 2001. The t
program requires the following estimated h
expenditures: e

P e
1 n
, d
0
0 o
0 f
,
0 2
0 0
0 0
3
a
t To accumulate the required funds, it establish a sinking
fund constituting of 15 uniform annual deposits, the first
t deposit has been made at the end of 1992. The interest
h rate of the fund is 2% per annum. Calculate the annual
e deposit.
A. P217,520.05
e B. P216,980.12
n C. P217,679.01
d D. P216,733.29
Froyd Review & Training Center Inc. is expanding its school
o facilities starting 2001. The program requires the following
f estimated expenditures:

2 P
0 1
, d
0
0 o
0 f
,
0 2
0 0
0 0
3
a
t To accumulate the required funds, it establish a sinking
fund constituting of 15 uniform annual deposits, the first
t deposit has been made at the end of 1992. The interest
h rate of the fund is 2% per annum. Calculate the balance
e in the fund on January 1, 2002.
A. P2,185,902.11
e B. P2,195,600.03
n C. P2,165,399.54
d D. P2,175,380.00

o 648. Padilla Pawnshop sells

f
jewelries on either of the following
2
0 arrangements: Cash Price: Discount of
0
1 10% of the marked price

P Installment: Downpayment of 20% of the marked price

1 and the balance payable in equal annual installments for
, the next 4 years.
2
0 If you are buying a necklace with a marked price of
0 P5,000, how much is the difference between buying in
, cash and buying in installment? Assume that money is
0 worth 5%.
0 A. P40.76
0
B. P41.90
a C. P43.54
t D. P45.95

t 649. Lim Bon Fing Y Hermanos Inc has offered

h for sale its two-storey building in the commercial
e district of Cebu City. The building contains two
stores on the ground floor and a number of offices
e on the second floor.
n
d A prospective buyer estimates that if he buys this
property, he will hold it for about 10 years. He estimates
o that the average receipts from the rental during this
f period to be P350,000.00 and the average expenses for
all purpose in connection with its ownership and
2 operation (maintenance and repairs, janitorial services,
0 insurance, etc.) to be P135,000.00. He believes that the
0 property can be sold for a net of P2,000,000 at the end of
2 the 10th year. If the rate of return on this type of
investment is 7%, determine the cash price of this
P property for the buyer to recover his investment with a
1 7% return before income taxes.
, A. P2,526,768.61
5 B. P2,490,156.34
0 C. P2,390,189.00
0 D. P2,230,120.56
,
0 650. Bicol Hardware Inc is considering two
0 alternative strategies for a new power tool. According to
0 Jun Ramos who is introducing the power tool, the new
product will require an outlay of P30,000 with a low
a price strategy. The product will generate cash proceeds
t of P20,000 per year and will have a life to two years.
With a high price strategy, the product will generate
t cash proceeds of P36,000 but will have a life of only one
h year. The cost of money for the company is 10%.
e Determine the net present value of the low price
strategy.
e A. P34,389.12
n B. P34,490.10
 C. P34,518.89 A. P252.12
D. P34,710.74 B. P261.89
Bicol Hardware Inc is considering two alternative strategies for a C. P273.90
new power tool. According to Jun Ramos who is introducing the D. P280.94
power tool, the new product will require an outlay of P30,000 with
a low price strategy. The product will generate cash proceeds of 654. A father wishes to provide P40,000 for his
P20,000 per year and will have a life to two years. With a high price son on his son’s 21st birthday. How much should he
strategy, the product will generate cash proceeds of P36,000 but deposit every 6 months in a savings account which
will have a life of only one year. The cost of money for the company pays 3% compounded semi- annually, if the first
is 10%. Determine the net present value of the high price strategy. deposit was made when the son was 3 ½ years old?
A. P32,727.27 A. P829.68
B. P33,737.34 B. P815.80
C. P33,747.20 C. P830.12
D. P33,757.89 D. P846.10

651. John Smith plans to purchase a new house 655. A group of Filipino Mechanical Engineers
costing P1,000,000. He can raise the building by issuing a formed a corporation and the opportunity to invest
10%, 20 year old bond that would pay P150,000 interest P8,000,000 in either of the two situations. The first is to
per year andrepay the face amount at maturity. Instead expand a domestic operation. It is estimated that this
of buying the new house, Jan Michael has an option of investment would return a net year end cash flow of
leasing it for P140,000 per year, the first payment due P2,000,000 each year for 10 years and at the end of that
one year from now. The building has an expected life of time, the physical assets, which would no longer be
20 years. If interest charge for leasing is 12%, which of needed, could be sold at P5,000,000. The alternative
the following is true? opportunity would involve building and operating a plant
A. Lease is more economical than borrow and buy. in a foreign country. This operation would involve no net
B. Lease has same result with borrow and buy. cash flow during the first 3 years, but it is believed that,
C. Borrow and buy is half the value than lease. beginning with the end of the fourth year, an annual flow
D. Borrow and buy is economical by almost a hundred of P4,000,000 would be received, running through the
thousand than lease. end of the 10th year. After that time, it is believed that
the operation and facilities might be expropriated, with
little, if any, compensation, being paid. Which of the
652. Engr. Edward Zuela is considering establishing
following is true?
his own business. An investment of P100,000 will be
required which must be recovered in 15 years. It is A. Foreign operation yields bigger rate of return.
estimated that sales will be P150,000 per year and that B. Domestic and foreign operations yield the same rate of
annual operating expenses will be as follows: return.
C. Domestic operation has double the rate of return of the
Materials foreign operation.
P40,000 D. Foreign operation yields approximately 3% less rate of
return than domestic operation.
Labor
P70,000 656. A house costs P400,000 cash. A purchaser will
pay P90,000 cash, P60,000 at the end of 2 years and a
Overhead sequence of 6 equal annual payments starting with one
P10,000 + 10% of sales at the end of 4 years, to discharge all his liabilities as to
the principal and interest at 7% compounded annually.
Selling expenses Find the annual payment which must be made for 6
P5,000 years.
A. P66,204.14
Engr. Zuela will give up his regular job paying P15,000 per B. P65,701.67
year and devote full time to the operation of the C. P67,901.34
business. This will result in decreasing labor cost by D. P68,900.12
P10,000 per year, material cost by P7,000 per year and
overhead cost by P8,000 per year. If he expects to earn 657. Two years ago, the rental for the use of
at least 20% of his capital, is investing in this business a equipment and facilities as paid 5 years in advance, with
sound idea? option to renew the rent for another years by payment of
A. Yes, it is a sound idea P15,000 annually at the start of each year for the renewal
B. No, it is not a sound idea period. Now, the lessor asks the lessee if it could be
C. Neither yes nor no because it simply breakeven possible to prepay the rental that will be paid annually in
D. It depends on the current demand of the market. the renewed 5 years period. If the lessee will consider the
request, what would be the fair prepayment to be made
to the lessor if interest is now figured at 8 %?
653. A housewife bought a brand new washing
machine costing P12,000 if paid in cash. A. P51,843.90
However, she can purchase it on installment basis to be B. P51,346.58
paid within 5 years. If money is worth 8% compounded C. P52,002.45
annually, what is her yearly amortization if all payments D. P52,740.20
are to be made at the beginning of each year? NSN Builders plans to construct an additional building at the end
A. P2,617.65 of 10 years for an estimated cost of P5,000,000.00. To
B. P2,782.93 accumulate the amount, it will have equal year end deposits in a
C. P2,890.13 fund earning 13%. However, at the end of the 5th year, it was
D. P2,589.90 decided to have a larger building that originally intended to an
A Civil Engineering student borrowed P2,000.00 to meet college estimated cost of P8,000,000.00. What should be the annual
expenses during his senior year. He promised to repay the loan with deposit for the last 5 years?
interest at 4.5% in 10 equal semi-annual installments, the first A. P734,391.48
payment to be made 3 years after the date of the loan. How much B. P742,890.10
will this payment be? C. P738,900.45
 D. P740,010.86 its copyright to Warner Bros. for the rights to make it into a motion
picture. Mr. Grisham’s has options between the following Warner
Bros. proposals:
658. An investment consisting of deposits of
P1,000, P1,500 and P2,000 are made at the end of the E. An immediate lump sum payment of $5,000,000.
2nd year, 3rd year and 4th year, respectively. If money F. An initial payment of $2,500,000 plus 4% of the
is worth 10%, what is the equivalent present worth of movie’s gross receipts for the next 5 years which is
the investment? forecasted as follows:
A. P3,129.89
B. P3,319.45 End of year Gross receipt
C. P3,372.12
D. P3,490.09 1 $10,000,000.00

659. Miss Marcial deposited P1,000, P1,500 and 2 $8,000,000.00

P2,000 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 3 $6,000,000.00
of the 4th year?
A. P4,880.00 4 $4,000,000.00
B. P4,820.00
C. P4,860.00
D. P4,840.00 5 $2,000,000.00
Miss Santos deposited P1,000, P1,500 and P2,000 at the end of
the 2nd year, 3rd year and 4th year, respectively in a savings If money is worth 10% and Mr. Grisham will not
account which earned 10% per annum. What is the equivalent receive any royalty after the fifth year of
uniform deposit for the uniform gradient only? exhibition of the movie, by how much is
A. P670.81 proposal A bigger than proposal B?
B. P690.58 A. P1,532,630
C. P660.53 B. P1,390,090
D. P680.12 C. P1,478,100
D. P1,289,450
660. An amortization of a debt is in a form of a
gradient series of P5,000 on the first years, P4,500 on 664. Two sisters, Joan and Jocelyn decided to save
the second year, P4,000 on the third year and P3,500 on money in funds that earns 14% compounded annually
the fourth year. What is the equivalent present worth but on different ways. Joan decided to save by making
of the debt if interest is 5%? an end-of-year deposit of P1,000 on the first year,
A. P15,093.28 P1,100 on the second year, P1,210 on the third year and
B. P15,178.34 so on increasing the next year’s deposit by 10% of the
C. P15,890.12 deposit in the preceding year until the end of the 10th
D. P15,389.82 year. Jocelyn decided to save by just making an equal
deposit of P1,400 annually for 10 years. Who has more
661. An amortization of a debt is in a form of a savings at the end of 10 years and by how much bigger
gradient series of P5,000 on the first year, P4,500 on compared to the other sister?
the second year, P4,000 on the third year, P3,500 on A. Jocelyn, P671.18
the fourth year. Determine future amount of the
B. Jocelyn, P763.27
amortization if interest is 5%.
A. P18,030.56 C. Joan, P671.18
B. P18,290.12 D. Joan, P763.27
C. P18,621.89
D. P18,449.37 665. Engr. Maragat, believing that life begins at 40,
decided to retire and start enjoying life at age 40. He
662. An amortization of a debt is in a form of a wishes to have upon his retirement the sum of
gradient series of P5,000 on the first year, P4,500 on P5,000,000. On his 21st birthday, he deposited a certain
the second year, P4,000 on the third year, P3,500 on amount and increased his deposit by 15% each year until
the fourth year. What is the equivalent uniform he will be 40. If the money is deposited in a super savings
periodic payment if interest is 5%? account which earns 15% interest compounded annually,
how much was his initial deposit?
A. P4,280.47
B. P4,378.17 A. P17,253.18
C. P4,259.68 B. P17,566.33
D. P4,325.12 C. P17,672.77
D. P17,490.21
663. An NBA Basketball superstar, playing for Los
Angeles Lakers is earning an average annual salary of 666. A newly-acquired equipment requires an
$5,000,000 for 10 years. Chicago Bulls ball club would like annual maintenance costs of P10,000. If the annual
to acquire his services as a replacement of the retired maintenance cost is increased by 20% each year
Michael Jordan, offered him an initial annual salary of every year for 10 years, what is the estimated present
$3,000,000 but is increasing at the rate of $400,000 worth of the maintenance costs if money is worth
annually. If he can still play in the NBA for 10 years and 15%?
money is worth 10%, which one is true? A. P105,712.33
A. Chicago Bulls’ offer is smaller than that of LA Lakers’ B. P106,101.37
B. Chicago Bulls’ offer is exactly the same as LA Lakers’ C. P107,490.12
C. Chicago Bulls’ offer is just few dollars more per year D. P108,890.11
than that of LA Lakers’ A company issued 50 bonds of P1,000.00 face value each,
redeemable at par at the end of 15 years. To accumulate the funds
D. Chicago Bulls’ offer is over $150,000 per year than that required for redemption the firm established a sinking fund
of LA Lakers’
consisting of annual deposits, the interest rate of the fund being
John Grisham, author of the best-selling novel “The Chamber” sold
4%. What was the principal in the fund at the end of the 12th year? straight line
A. P37,002.54 method? A.
B. P37,520.34 P2,000.00
C. P38,010.23 B. P2,100.00
D. P38,782.34 C. P2,200.00
D. P2,300.00
667. A local firm is establishing a sinking fund for
the purpose of accumulating a sufficient capital to 674. A telephone company purchased a
retire its outstanding bonds at maturity. The bonds are microwave radio equipment for P6 million, freight and
redeemable in 10 years and their maturity value is installation charges amounted to 4% of the
P150,000.00. How much should be deposited each purchased price. If the equipment will be depreciated
year if the fund pays interest at the rate of 3%? over a period of 10 years with a salvage value of 8%,
A. P13,084.58 determine the depreciation cost during the 5th year
B. P13,048.85 using SYD.
C. P13,408.58 A. P626,269.09
D. P13,480.58 B. P623,209.09
C. P625,129.09
668. A P1,000,000 issue of 3%, 15-year bond was D. P624,069.89
sold at 95%. What is the rate of interest of this
investment? 675. ABC Corporation makes it a policy that for
A. 3.0% any new equipment purchased, the annual
B. 3.4% depreciation cost should not exceed 20% of the first
C. 3.7% cost at any time with no salvage value. Determine the
D. 4.0% length of service life necessary if the depreciation
used is the SYD method.
669. A man was offered a Land Bank certificate A. 7 years
with a face value of P100,000 which is bearing interest B. 8 years
of 6% per year payable semiannually and due in 6 years.
C. 9 years
If he wants to earn 8% semiannually, how much must he
pay the certificate? D. 10 years
A company purchases an asset for P10,000.00 and plans to keep it
A. P90,123.09 for 20 years. If the salvage value is zero at the end of the 20th year,
B. P90,614.93 what is the depreciation in the third year? Use SYD method.
C. P90,590.12 A. P857.14
D. P90,333.25 B. P862.19
C. P871.11
670. A P1,000 bond which will mature in 10 years
D. P880.00
and with a bond rate of 8% payable annually is to be
redeemed at par at the end of this period. It is sold at
P1,030. Determine the yield at this price. 676. An asset is purchased for P500,000.00. The
A. 7.56% salvage value in 25 years is P100,000.00.
B. 7.65% What is the total depreciation in the
first three years using straight-line
C. 7.75% method? A. P45,000.00
D. 7.86% B. P46,000.00
C. P47,000.00
671. You purchase a bond at P5,100. The D. P48,000.00
bond pays P200 per year. It is redeemable for
P5,050 at the end of 10 years. What is the net 677. A machine has an initial cost of P50,000 and a
rate of interest on your investment? salvage value of P10,000 after 10 years.
A. 3.56% What is the book value
B. 3.85% after 5 years using
C. 3.75% straight line
D. 3.68% depreciation? A.
A P1,000, 6% bond pays dividend semiannually and will be P30,000.00
redeemed at 110% on June 21, 2004. It is bought on June 21, 2001 B. P31,000.00
to yield 4% interest. Find the price of the bond. C. P30,500.00
A. P1,122.70 D. P31,500.00
B. P1,144.81
C. P1,133.78 678. An asset is purchased for P9,000.00. Its
D. P1,155.06 estimated life is 10 years after which it will be sold for
P1,000.00. Find the book value during the first year if
SYD depreciation is used.
672. A VOM has a selling price of P400. If its A. P7,545.45
selling price is expected to decline at a rate of 10% B. P7,320.11
per annum due to obsolescence, what will be its C. P7,490.00
selling price after 5 years? D. P7,690.12
A. P222.67
B. P212.90 679. The cost of equipment is P500,000 and the
C. P236.20 cost of installation is P30,000. If the salvage value is
D. P231.56 10% of the cost of equipment at the end of years,
determine the book value at the end of the fourth year.
673. A machine costs P8,000 and an estimated life of Use straight-line method.
10 years with a salvage value of P500. A. P146,320.50
What is its book B. P146,000.00
value after 8 C. P146,230.50
years using D. P146,023.50
 D. 0.1
680. An asset is purchased for P20,000.00. Its
estimated life is 10 years after which it will be sold for 687. The initial cost of a paint sand mill,
P12,000.00. Find the depreciation for the first year including its installation, is P800,000. The BIR
using SYD method. approved life of this machine is 10 years for
A. P1,545.45 depreciation. The estimated salvage value of the mill
B. P1,454.54 is P50,000 and the cost of dismantling is estimated
C. P1,344.21 to be P15,000. Using straight-line depreciation, what
D. P1,245.45 is the annual depreciation charge?
A. P75,500.00
681. A machine has an initial cost of P50,000 and a B. P76,000.00
salvage value of P10,000 after 10 years. C. P76,500.00
Find the book value D. P77,000.00
after 5 years using
straight-line 688. The initial cost of a paint sand mill,
depreciation. A. including its installation, is P800,000. The BIR
P31,000.00 approved life of this machine is 10 years for
B. P31,500.00 depreciation. The estimated salvage value of the mill
C. P30,000.00 is P50,000 and the cost of dismantling is estimated
D. P30,500.00 to be P15,000. Using straight-line depreciation, what
is the book value of the machine at the end of six
682. A machine has an initial cost of P50,000.00 years?
and a salvage value of P10,000.00 after 10 years. A. P341,000.00
What is the straight line method depreciation rate as B. P343,000.00
a percentage of the initial cost? A. 10% C. P340,000.00
B. 8% D. P342,000.00
C. 7% A unit of welding machine cost P45,000 with an estimated life
of 5 years. Its salvage value is P2,500. Find its depreciation rate
D. 9% by straight-line method.
A machine costing P45,000 is estimated to have a book value of
A. 18.89%
P4,350 when retired at the end of 6 years. Depreciation cost is
B. 19.21%
computed using a constant percentage of the declining book value.
What is the annual rate of depreciation in %? C. 19.58%
A. 32.50% D. 19.89%
B. 32.25%
C. 32.00% 689. A tax and duty free importation of a 30 hp
D. 32.75% sandmill for paint manufacturing cost P360,000.00.
Bank charges arrastre and brokerage cost P5,000.00.
Foundation and installation costs were P25,000.00.
683. An asset is purchased for P120,000.00. Its
Other incidental expenses amount to P20,000.00.
estimated life is 10 years, after which it will be sold for
Salvage value of the mill is estimated to be P60,000
P12,000.00. Find the depreciation for the second year
after 20 years. Find the appraisal value of the mill using
using the sum-of-years’ digit method.
straight line depreciation at the end of 10 years.
A. P17,578.13
A. P234,000.00
B. P17,412.43
B. P235,000.00
C. P17,344.67
D. P17,672.73 C. P234,500.00
D. P235,500.00
684. A machine costing P720,000 is estimated to
have a book value of P40,545.73 when retired at the end 690. An equipment costs P10,000 with a salvage value
of 10 years. Depreciation cost is computed using a of P500 at the end of 10 years.
constant percentage of the declining book value. What is Calculate the annual depreciation
the annual rate of depreciation in %? cost by sinking-fund method at 4%
A. 25% interest. A. P791.26
B. 26% B. P792.61
C. 27% C. P726.17
D. 28% D. P771.26

685. An asset is purchased for P9,000.00. Its 691. A machine initially worth P50,000
estimated economic life is 10 years after which it will be depreciates in value each year by 20% of its value at
sold for P1,000.00. Find the depreciation in the first three the beginning of that year. Find its book value when it
years using straight line method. is 9 years old.
A. P2,400.00 A. P6,710.89
B. P2,412.34 B. P6,400.89
C. P2,250.00 C. P6,666.89
D. P2,450.00 D. P6,512.78

686. An engineer bought an equipment for 692. A consortium of international

P500,000. He spent an additional amount of P30,000 telecommunications companies contracted for the
for installation and other expenses. The estimated purchase and installation of fiber optic cable linking
useful life of the equipment is 10 years. The salvage Manila City and Cebu City at a total cost of P960
value is x% of the first cost. Using the straight line million. This amount includes freight and installation
method of depreciation, the book value at the end of charges estimated at 10% of the above total contract
5 years will be P291,500. What is the value of x? price. If the cable shall be depreciated over a period of
15 years with zero salvage value and money is worth
A. 0.2 6% per annum, what is the annual depreciation charge?
B. 0.4
A. P41,044,903.40
C. 0.3
B. P41,211,158.40
 C. P41,254,000.40
D. P41,244,253.40

693. 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 sum-of-years’ digit method.
A. P3,279.27
B. P3,927.27
C. P3,729.27
D. P3,792.72

694. A radio service panel truck initially cost

P560,000. Its resale value at the end of the 5th year of
the useful life is estimated at P150,000. By means of
declining balance method, determine the depreciation
charge for the second year.
A. P99,658.41
B. P99,128.45
C. P99,290.00
D. P99,378.45
 695. Shell Philippines, a multinational company, has C. P332,509.33
a total gross income for a particular year of P50,000,000. D. P341,240.33
The taxable income after taking all deductions except for
depletion is P18,500,000. What is the allowable 702. A man planned of building a house. The cost
depletion allowance for that particular year? Take of construction is P500,000 while annual maintenance
percentage of gross income for oil as 22%. cost is estimated at P10,000. If the interest rate is 6%,
A. P9,358.41 what isthe capitalized cost of the house?
B. P9,228.45 A. P666,000.00
C. P9,250.00 B. P666,666.67
D. P9,308.45 C. P633,333.33
D. P650,000.00
696. The Saudi Arabian Oil Refinery developed an oil
well which is estimated to contain 5,000,000 barrels of 703. An untreated electrical wooden pole that will
oil at an initial cost of $50,000,000. What is the depletion last 10 years under a certain soil condition, costs
charge duringthe year where it produces half-million P1,200.00. If a treated pole will last for 20 years, what is
barrels of oil? Use Unit or Factor method in computing the maximum justifiable amount that can be paid for the
depletion. treated pole, if the maximum return on investment is
A. $500,000,000 12%. Consider annual taxes and insurance amount to be
1% of the first cost.
B. $510,000,000
A. P1,612.01
C. $525,000,000 B. P1,559.50
D. $550,000,000 C. P1,789.23
D. P1,409.38
697. The first cost of a certain equipment is
P324,000 and a salvage value of P50,000 at the end of 704. A granite quarry purchased for P1,600,000 is
its life of 4 years. If money is worth 6% compounded expected to be exhausted at the end of 4 years. If the
annually, find the capitalized cost. A. P540,090.34 resale value of the land is P100,000, what annual
B. P541,033.66 income is required to yield an investment rate of 12%?
C. P540,589.12 Use a sinking fund rate of 3%.
D. P541,320.99 A. P550,540.57
B. P551,540.57
698. An item is purchased for P100,000. Annual C. P552,540.57
cost is P18,000. Using interest rate of 8%, what is the D. P553,540.57
capitalized cost of perpetual service?
A. P310,000 705. A manufacturer produces certain items at a
B. P315,000 labor cost per unit of P315, material cost per unit is
C. P320,000 P100, variable cost of P3.00 each. If the item has a
D. P325,000 selling price of P995, how many units must be
manufactured each month for the manufacturer to
699. A corporation uses a type of motor which costs breakeven if the monthly overhead is P461,600?
P5,000 with 2 life years and final salvage value of P800. A. 782
How much could the corporation afford to pay for B. 800
another type of motor of the same purpose whose life is C. 806
3 years a with a final salvage value of P1,000. Money is D. 812
worth 4%.
A. P7,892.13 706. The annual maintenance cost of a machine
B. P7,157.40 shop is P69,994. If the cost of making a forging is P56 per
C. P7,489.21 unit and its selling price is P135 per forged unit, find the
D. P7,300.12 number of units to be forged to break-even.
A. 892
700. A motorcycle costs P50,000 and has an B. 870
expected life of 10 years. The salvage value is C. 886
estimated to be P2,000 and annual operating cost is D. 862
estimated at P1,000. What is the appropriate rate of
return on the investment if the annual revenue is
P10,000?
707. A manufacturer produces certain items at a
labor cost of P115 each, material cost of P76 each and
A. 12.12%
variable cost of P2.32 each. If the item has a unit price of
B. 12.54% P600, how many units must be manufactured each
C. 12.72% month for the manufacturer to break even if the monthly
D. 12.99% overhead is P428,000.
A. 1,033
701. At 6%, find the capitalized cost of a bridge B. 1,037
whose cost is P250M and life is 20 years, if the bridge C. 1,043
must be partially rebuilt at a cost of P100M at the D. 1,053
end of each 20 years. Steel drum manufacturer incurs a yearly fixed operating cost of
A. P297,308,323.10 $200,000. Each drum manufactured cost $160 to produce and sells
B. P298,308,323.10 $200. What is the manufacturer’s break-even sales volume in drums
C. P296,308,323.10 per year?
D. P295,308,323.10 A. 5,031
A new broiler was installed by a textile plant at a total cost of B. 5,017
P300,000 and projected to have a useful life of 15 years. At the end
C. 5,043
of its useful life, it is estimated to have a salvage value of P30,000.
Determine its capitalized cost if interest is 18% compounded D. 5,000
annually.
A. P323,500.33 708. XYZ Corporation manufactures bookcases
that sell for P65.00 each. It costs XYZ corporation
B. P322,549.33
P35,000 per year to operate its plant. This sum includes
 rent, depreciation charges on equipment, and salary
payments. If the cost to produce one bookcase is P
P50.00, how many cases must be sold each year for XYZ 2
to avoid taking a loss? 0
A. 2,334 .
B. 2,443 0
C. 2,223 0
D. 2,322
T
a
709. A company which manufactures electric motors x
has a production capacity of 200 motors a month. The
variable costs are P150.00 per motor. The average selling t
price of the motors is P275.00. Fixed costs of the o
company amount to P20,000 per month which includes
taxes. Find the number of motors that must be sold each b
month to breakeven. e
A. 160
B. 157 p
C. 153 a
D. 163 i
d
710. The annual maintenance cost of a machine is
P70,000. If the cost of making a forging is P56 and its p
selling price is P125 per forged unit. Find the number of e
units to be forged to breakeven. r
A. 1,000
B. 1,012 b
C. 1,015 l
D. 1,018 o
c
711. A manufacturing firm maintains one product k
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 P
the line to meet the demand? 2
A. 1.0 hours per unit .
B. 1.2 hours per unit 0
0
C. 1.4 hours per unit R
D. 1.6 hours per unit e
a
712. Compute the number of blocks that an ice l
plant must be able to sell per month to break even based
on the following data: E
s
C t
o a
s t
t e

o T
f a
x
e
l -
e
c P
t 3
r ,
i 5
c 0
i 0
t .
y 0
0
p
e p
r e
r
b
l m
o o
c n
k t
h
-
 S cost of P85.00 per unit and material cost of P350.00 per unit. The
a fixed charges on the business are P15,000 per month and the
l variable costs are P20.00 per unit. If the automatic voltage
a regulators are sold to retailers at P580.00 each, how many units
r must be produced and sold per month to breakeven? A. 120
i B. 124
e C. 128
s D. 130

a 713. General Electric Company which manufactures

n electric motor has a capacity of producing 150 motors a
d month. The variable costs are P4,000.00 per month, the
average selling price of the motor is P750.00 per motor.
W Fixed costs of the company amount to P78,000.00 per
a month which includes all taxes. Determine the number
g of motors to be produced per month to breakeven.
e
s A. 100
B. 104
- C. 110
D. 112
P
2 714. A telephone switchboard 100 pair cable can be
5 made up with either enamelled wire or tinned wire.
, There will be 400 soldered connections. The cost of
0 soldering a connection on the enamelled wire will be
0 P1.65, on the tinned wire, it will be P1.15. A 100-pair
0 cable made up with enamelled wire cost P0.55 per linear
. foot and those made up of tinned wire cost P0.75 per
0 linear foot. Determine the length of cable run in feet so
0 that the cost of each installation would be the same.
A. 1,000 feet
p B. 1,040 feet
e
r
C. 1,100 feet
D. 1,120 feet
m
o 715. A local factory assembling calculators
n produces 400 units per month and sells them at
t P1,800 each. Dividends are 8% on the 8,000 shares
h with par value of P250 each. The fixed operating cost
per month is P25,000. Other costs are P1,000 per unit.
O If 200 units were produced a month, determine the
t profit or loss.
h A. Profit of P121,666.67
e B. Profit of P21,666.67
r C. Loss of P121,666.67
s D. Loss of P21,666.67

-
716. Nike shoes manufacturer produces a pair of
Air Jordan Shoes at a labor cost of P900.00 a pair and a
P
material cost of P800.00 a pair. The fixed charges on the
1
business are P5,000,000 a month and the variable costs
2
are P400.00 a pair. Royalty to Michael Jordan is P1,000
,
per pair of shoes sold. If the shoes sell at P5,000 a pair,
0
how many pairs must be produced each month for the
0
manufacturer to breakeven?
0
. A. 2,590
0 B. 2,632
0 C. 2,712
D. 2,890
p
e
r

m
o
n
t
h
Selling price of ice - P55.00 per block

A. 1,220
B. 1,224
C. 1,228
D. 1,302
JRT Industries manufactures automatic voltage regulators at a labor
717. In a steel fabrication shop located e
somewhere in Cebu, various size rivet holes must be n
made in structural members. This may be done by t
laying out the position of the hole on the members and
using a drill press for this method, a machinist wage p
rate is P20.25 per hour and he can drill 27 holes per r
hour. An alternative method is by the use of the o
multiple punch machine. In this process, the machinist f
wage rate is P20.00 per hour and he can complete 8 i
holes per minute. This method requires P0.50 per holes t
to set the multiple punch machine and an installation
cost of P2,000.00. If all other costs are the same, for o
what number of rivet holes will the multiple punch r
machine pay for itself?
A. 9,601 l
B. 9,592 o
C. 9,581 s
D. 9,566 s
?
718. A new civil engineer produces a certain
construction material at a labor cost of P16.20 per piece, A
material cost of P38.50 per piece and variable cost of .
P7.40 per piece. The fixed charge on the business is
P100,000.00 per month. If he sells the finished product at P
P95.00 each, how many pieces must be manufactured in 8
each month to breakeven? 7
,
A. 3,045
4
B. 3,035
5
C. 3,030
0
D. 3,040
B. P88,960
719. The Asian Transmission Co. makes and C. P88,450
sells certain automotive parts. Present sales D. P87,960
volume is 500,000 units per year at a selling price
of fifty centavos (P0.50) per unit. Fixed expenses 722. A factory engaged in the fabrication of an
total P80,000.00 per year. What is the present automobile part with a production capacity of 700,000
total profit for a year? units per year is only operating at 62% of capacity due to
A. P168,000 unavailability of the necessary foreign currency to
B. P170,000 finance the importation of their raw materials. The
C. P172,000 annual income is P430,000.00. Annual fixed costs are
D. P174,000 P190,000.00 and the variable costs are P0.348 per unit.
W
h
720. The Asian Transmission Co. makes and
a
sells certain automotive parts. Present sales
t
volume is 500,000 units per year at a selling price
of fifty centavos (P0.50) per unit. Fixed expenses
i
total P80,000.00 per year. What is the present
s
breakeven point in units?
A. 160,000
t
B. 162,000 h
C. 165,000 e
D. 170,000
b
721. A factory engaged in the fabrication of an r
automobile part with a production capacity of 700,000 e
units per year is only operating at 62% of capacity due to a
unavailability of the necessary foreign currency to k
finance the importation of their raw materials. The e
annual income is P430,000.00. Annual fixed costs are v
P190,000.00 and the variable costs are P0.348 per unit. e
W n
h
a p
t o
i
i n
s t
?
t
h A
e .

c 2
u 9
r 4
r ,
5
 6 P
0 4
B. 291,000 0
C. 290,780 .
D. 295,490 0
A certain firm has the capacity to produce 650,000 units of product 0
per year. At present, it is operating at 62% capacity. The firm’s
annual income is P4,160,000.00. Annual fixed costs are U
P1,920,000.00 and the variable costs are equal to P3.56 per unit of n
product. What is the firm’s annual profit or loss? i
A. P814,320 t
B. P815,230 v
C. P816,567 a
D. P817,239 r
i
723. A certain firm has the capacity to produce a
650,000 units of product per year. At present, it is b
operating at 62% capacity. The firm’s annual income is l
P4,160,000.00. Annual fixed costs are P1,920,000.00 and e
the variable costs are equal to P3.56 per unit of product.
What volume of sales does the firm breakeven? c
A. P3,354,680 o
B. P3,534,880 s
C. P3,155,690 t
D. P3,254,680
-
724. A small shop in Bulacan fabricates threshers for
P
palay producers in the locality. The shop can produce
2
each thresher at a labor cost of P1,800.00. The cost of
0
materials for each unit is P2,500.00. The variable costs
.
amounts to P650.00 per unit while fixed charges incurred
0
per annum totals P69,000.00. If the portable threshers
0
are sold at P7,800.00 per unit, how many units must be
U
produced and sold per annum to breakeven?
n
A. 28 i
B. 25 t
C. 26
D. 27 c
o
725. The direct labor cost and material cost of a n
certain product are P300 and P400 per unit, respectively. t
Fixed charges are P100,000 per month and other variable r
costs are P100 per unit. If the product is sold at P1,200 i
per unit, how many units must be produced and sold to b
breakeven? u
A. 280 t
B. 250 i
o
C. 260
n
D. 270
m
726. The following data for year 2000 are available a
for Cagayan Automotive Company which manufactures r
and sells a single automotive product line: g
i
U n
n
i -
t
P
s 2
e 0
l .
l 0
i 0
n
g T
o
p t
r a
i l
c
e f
i
- x
e
 d a
t
c e
o r
s i
t a
s l

- c
o
P s
2 t
0
0 -
,
0 P
0 1
0 5
. .
0 0
0 0

What is p
the e
breakeven r
point in
units for u
the n
current i
year? A. t
10,000
B. 10,100 F
C. 10,050 i
D. 10,200 x
The cost of producing a small transistor radio set consists of P230.00 e
for labor and P370.00 for material. The fixed charges is operating d
the plant is P1,000,000.00 per month. The variable cost is P10.00
per set. The radio set can be sold for P750.00 each. Determine how c
many sets must be produced per month to breakeven. h
A. 7,123 a
r
B. 7,133
g
C. 7,143
e
D. 7,153
s
727. An item which can be sold for P63.00 per -
unit wholesale is being produced with the following
cost data: P
1
L 0
a ,
b 0
o 0
r 0
.
c 0
o 0
s
t V
a
- r
i
P a
1 b
0 l
. e
0
0 c
o
p s
e t
r
-
u
n P
i 8
t .
0
M
 0 C. P13,333.20
D. P16,323.20
p
e
r 848. A time deposit of P110,000 for 31days earns
P890.39 on maturity date after deducting the 20%
u withholding tax on interest income. Find interest per
n annum.
i A. 12.5%
t B. 11.95%
C. 12.25%
What is the breakeven point sales volume if one out of D. 11.75%
every 10 units produced is defective and is rejected with
only full recovery on materials? 849. A bank charges 12% simple interest on a
A. P25,011 P300.00 loan. How much will be repaid if the loan is
B. P25,111 paid back in one lump sum after three years.
C. P25,121 A. P 408.00
D. P25,132 B. P 551.00
C. P415.00
D. P450.00
842. Find the interest on P6,800.00 for 3 years at 11%
simple interest. 850. A tag price of a certain
commodity is for 100 days. If paid in 31
A. P 1,875.00
days, there is 3%discount. What is the
B. P 1,987.00 simple interest paid?
C. P 2,144.00 A. 12.5%
D. P 2,244.00
B. 6.25%
C. 22.32%
843. A man borrowed P10,000.00 from his
D. 16.14%
friend and agrees to pay at the end of 90 days
under 8% simple interest rate. What is the required
amount? 851. Accumulate P5,000.00 for 10 years at 8%
A. P 10,200.00 compounded quarterly.
B. P 11,500.00 A. P 12,456.20
C. P 9,500.00 B. P 13,876.50
D. P 10,700.00 C. P10,345.80
D. P11,040.20
Accumulate P5,000.00 for 10 years at 8% compounded semi-annually.
844. Annie buys a television set from a merchant
A. P 10,955.61
who offers P25,000.00 at the end of 60days. Annie
B. P 10,233.67
wished to pay immediately and the merchant offers to
C. P9,455.67
compute the required amount on the assumption that
D. P11,876.34
the money is worth 14% simple interest. What is the
required amount?
A. P 20,234.87 852. Accumulate
B. P 19,222.67 P5,000.00 for 10 years at
C. P 24,429.97 8% compounded monthly
D. P 28,456.23 A. P 15,456.75
What is the principal amount if the amount of interest at B. P 11,102.61
the end of 2 1/2 year is P4,500.00 for a simple interest of C. P10,955.61
6% per annum? D. P10,955.61
A. P 35,000.00
B. P 30,000.00 853. Accumulate P5,000.00 for 10 years at 8%
C. P 40,000.00 compounded annually.
A. P 10,794.62
D. P 45,000.00
B. P 8,567.97
845. How long must a P40,000 note bearing 4% simple C. P10,987.90
interest run to amount to P41,350.00? D. P7,876.87
A. 340days
B. 403 days 854. How long it will take P1,000 to
amount to P1,346 if invested at 6%
C. 304 days compounded quarterly.
D. 430 days A. 3 years
B. 4 years
846. If P16,000 earns P480 in 9monnths, what is the
annual rate of interest?
C. 5 years
A. 1% D. 6 years
B. 2% 855. How long will it take for an investment to
C. 3% double its amount if invested at an interest rate of 6%
D. 4% compounded bi-monthly
A. 10 years
847. A man lends P6,000 at 6% simple interest for B. 12 years
4 years. At the end of this time he invest the entire
C. 13 years
amount (principal plus interest)at 5% compounded
annually for 12 years. How much will he have at the D. 14 years
end of the 16-year period.?
A. P 13,361.20 856. If the compound interest on P3,000.00 in
B. P 13,633.20 years is P500.00 then the compound interest on
 P3,000.00 in 4 years is: A. 1.15%
A. P 956.00 B. 13.84%
C. 10.03%
B. P 1,083.00
D. 11.52%
C. P1,125.00
D. P1,526.00
865. What is the worth of two P100,000
payments at the end of the third and the fourth
857. The salary of Mr. Cruz is increased by
year? The annual interest rate is 8%.
30%every 2 years beginning January 1, 1982.
A. P 152.87
Counting from that date, at what year will his
B. P 112.34
salary just exceed twice his original salary? A.
C. P 187.98
1988
D. P 176.67
B. 1989
C. 1990
D. 1991 866. A firm borrows P2,000.00 for 6years 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
858. If you borrowed P10,000 from the bank with
lump sum due?
18% interest per annum, what is the total amount to be
repaid at the end of one year. A. P 5,679.67
A. P 11,800.00 B. P 6,789.98
B. P 19,000.00 C. P 6,034.66
C. P28,000.00 D. P 5,888.77
D. P10,180.00 At an annual rate of return of 8%, what is the future worth
ofP1,000 at the end of 4 years?
859. What is the effective rate for an interest rate at A. P 1,388.90
B. P 1,234.56
12% compounded continuously?
C. P 1,765.56
A. 12.01%
B. 12.89% D. P 1,360.50
C. 12.42%
D. 12.75% 867. A student has money given by his grandfather
How long it will take for an investment to fivefold its in the amount of P20,000.00. How much money in the
amount if money is worth 14%compounded form of interest will he get if the money is put in a bank
semiannually. that offers 8% rate compounded annually at the end of
A. 11 7 years?
A. P 34,276.48
B. 12
B. P 34,270.00
C. 13 C. P 36,276.40
D. 14 D. P 34,266.68

860. An interest of 8% compounded

semiannually is how many percent if
compounded quarterly?
A. 7.81%
B. 7.85%
C. 7.92%
D. 8.01%

861. A man is expecting to receive P450,000.00 at

the end of 7 years. If money is worth 14% compounded
quarterly how much is it worth at present?
A. P 125,458.36
B. P 147,456.36
C. P162,455.63
D. P171,744.44

862. A man has a will of P650,000.00 from his

father. If his father deposited an amount of P450,000
in a trust fund earning 8% compounded annually,
after how many years will he man receive his will?
A. 4.55 years
B. 4.77 years
C. 5.11 years
D. 5.33 years

863. Mr. Adam deposited P120,000.00 in

a bank who offers 8%interest compounded
quarterly. If the interest is subject to a 14%
tax, how much will he receive after 5 years? A.
P 178,313.69
B. P 153,349.77
C. P 170,149.77
D. P 175,343.77

864. What interest compounded

monthly is equivalent to an interest rate
of 14% compounded quarterly