Simple & Compound Interest Questions and Answers

Sally will invest 8 000 a year for 20 years in a fund that will earn 6 annual interest If the first payment occurs at year end what amount will be in the fund in 20 years O a 294 284 72 O b 311 941 81 O c 310 942 35 O d 277 627 10

F Flag question A trial balance before adjustments included the following Sales 425 000 credit Sales returns and allowance 14 000 debit Accounts receivable 43 000 debit and Allowance for doubtful accounts 760 credit If the estimate of uncollectible is made by taking 10 of gross account receivables the amount of the adjustment is O a 4 300 O b 3 540 O c 4 224 O d 5 060

Flag question Ayman Inc made a 25 000 sale on account with the following terms 2 10 n 30 If the company uses the net method to record sales made on credit what is are the debit s in the journal entry to record the sale Oa Debit Accounts Receivable for 25 000 O b Debit Accounts Receivable for 25 000 and Sales Discounts for 500 Debit Accounts Receivable for 24 500 and Sales Discounts for 500 O d Debit Accounts Receivable for 24 500 C

Hamada invests 20 000 at 8 annual interest leaving the money invested without withdrawing any of the interest for 8 years At the end of the years Hamada withdraws the accumulated amount of money the amount of interest assuming the investment earns compound interest is O a 32 800 O b 17 018 60 O c 12 800 O d 7 200

At a restaurant If a party has eight or more people the gratuity is automatically added to the bill If x is the cost of the meal then the total bill C x with a 17 gratuity and an 8 sales tax is given by C x x 0 08x 0 1x Evaluate C 280 and interpret the meaning in the context of this problem Round to the nearest cent If the cost of the food is S then the total bill including tax and tip Is S X 3

2 pints Manny a calendar year taxpayer uses the cash method of accounting for his sole proprietorship In late December he performed 42 000 of legal services for a client Manny typically requires his clients to pay his bills immediately upon receipt Assume Manny s marginal tax rate is 37 percent this year and next year and that he can earn an after tax rate of return of 7 percent on his investments Required a What is the after tax income if Manny sends his client the bill in December b What is the after tax income if Manny sends his client the bill in January Use Exhibit 3 1 Note Round your answer to the nearest whole dollar amount c Based on requirements a and b should Manny send his client the bill in December or January Complete this question by entering your answers in the tabs below Required A Required B Answer is complete but not entirely correct Required C What is the after tax income if Manny sends his client the bill in December

The following information is available for Brendon Company before closing the accounts What will be the amount in the Income Summary account that should be closed to Brendon Capital J Brendon Capital J Brendon Withdrawals Services revenue Depreciation Expense Equipment Wages expense Interest expense Insurance expense Rent expense Multiple Choice 80 000 64 400 43 000 112 000 32 000 187 000 12 000 71 400 3 300 11 700 24 200

Required information Let Q x y denote the statement x is the capital of y Determine the truth value of Q Detroit Michigan The truth value of Q Detroit Michigan is Click to select Click to select true false

The graph of y f x is shown below b Is f x continuous at x 0 OYes No From left to right the graph starts below the x axis for negative values of x and decreases to negative infinity as x approaches zero from the left There is no point on the curve when x equals zero Then for positive values of x the graph decreases from positive infinity and approaches the x axis from above Answer each of the following questions about f x You have one submission for each question a Does lim f x exist x 0 OYes No c Is f x differentiable at x 0 Yes No 2

3 Jos borrows 1400 to buy a racing bicycle He repays the loan 2 years later in the amount of 1700 What annual rate of simple interest was Jos charged

find the coupon rate of a bond that is sold at 950 and has a par value with 1 000 5 years to maturity and a discount rate of 6 a 3 2 O b 5 3 O c 4 8 O d 6 2 Clear my choice

The following graph shows an aggregate demand AD curve and a short run aggregate supply SRAS curve for an economy Suppose that the economy is initially in a short nun equibnum at Py and Real GDP is 25 billion Suppose that at some point the price decreases to P PRICE LEVEL A P there is atput and consumers 18 m 21 H 14 HEAL GDP on t of 5 BRAS Ad M billion goods As a result the price level consumption a shortage or a surplus Falls or remains the same or rises Decrease or do not charge or increase firms

The following graph shows an economy s short run aggregate supply curve SRAS current equilibrium aggregate price level P and real GDP Q The economy currently has Natural Real GDP QN of 6 trillion Use this information to place the orange long run aggregate supply curve LRAS square symbols in the correct position on the graph PRICE LEVEL 0 REAL GOP Trilions of dolara REAL GDP Trillions of usag SRAS 1 above or below It LRAS The equilibrium A shown on the graph reveals that real GDP Q1 is shifting SRAS Natural Real GDP As a result wages will over time Save Continue Continue without saving

A B Ready 53 Modified see template for modifications to the problem You would like to have 500 000 in 20 years To accumulate this amount you plan to deposit an equal sum in the bank each year that will earn 7 interest compounded annually Your first payment will be made at the end of the year a How much must you deposit annually to accumulate this amount b If you decide to make a large lump sum deposit today instead of the annual deposits how large should this lump sum be Assume you can earn 7 on the deposit c At the end of 10 years you will receive 120 000 and deposit this in the bank toward your goal of 500 000 at the end of 20 years In addition to this deposit how much must you deposit in equal annual deposits to reach your goal at 7 PV I nper pmt FV PV nper pmt FV C Step 1 PV 1 nper pmt FV 7 20 12 196 46 500 000 00 129 209 50 7 20 0 00 500 000 00 Hint first in Step 1 determine how much 100K will be worth at the end of 20 years 100 000 00 7 10 H 196 715 14 500 000 K Step 2 Hint in Step 2 for the FV figure use 500 000 minus the amount from Step 1 Instructions Questions P6 53M P6 54M P6 24M Accessibility Investigate L M H M

0 1 2 13 15 16 17 P6 21 Modified use the modified numbers in bold below You ve just bought a new 85 inch flat screen TV for 2 499 and the store you bought it from offers to let you finance the entire package at an annual rate of 12 compounded monthly If you take the financing and make monthly payments of 83 how long in years will it take to pay off the loan How much will you pay in interest over the life of the loan 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 Hint Use the NPER function in Excel to solve the problem The PV figure is the amount you are financing PV 1 m nper pmt FV Total payments PV Interest Paid 2 499 12 00 12 36 00 months 83 00 800 8 33 2 499 2 490 67 number of payme 489 3 00 years 1836 50 4150 36

Geo Star Manufacturing Company is considering a new investment in a punch press machine that will cost 98 000 a has an annual maintenance cost of 8 000 There is also an additional overhauling cost of 23 000 for the equipmen once every four years Assuming that this equipment will last infinitely under these conditions what is the capitalized equivalent cost of this investment at an interest rate of 10 Click the icon to view the interest factors for discrete compounding when i 10 per year The capitalized equivalent cost of this investment is thousand Round to the nearest whole number

submitted by those under 25 years of age Suppose 9 property damage claims involving automobiles are selected at random a Letr be the number of claims made by people under age 25 Make a histogram for the r distribution probabilities 0 30 O O 2 P r 2 0 25 0 20 0 15 0 10 0 05 0 00 0 30 0 25 0 20 0 15 0 10 0 05 0 00 0 4 0 3 0 2 0 1 0 0 0 35 0 30 0 25 0 20 0 15 0 10 0 05 USE SALT 0 00 0 1 2 3 0 1 2 3 0 1 3 4 5 0 1 2 3 2 3 4 r r 5 6 7 8 9 6 7 5 6 7 8 9 4 5 6 7 8 9 r 4 5 6 7 8 9 b What is the probability that two or more claims are made by people under age 25 Round your answer to three decimal places

A woman borrowed 3400 from a bank for 3 months A friend was cosigner of the woman s personal note Th 1 bank collected 6 simple interest on the date of maturity 2 a How much did the woman pay for the use of the money b Determine the amount she repaid to the bank on the due date of the note a The woman paid 55 25 for the use of the money b On the due date of the note the woman repaid to the bank

Submit Answer 1 Points DETAILS Math 110 Course Resources Functions Course Packet on market equilibrium The demand and supply functions for Penn State football jerseys are p d x 2004 x p s x 99x2 800x 4 where x is the number of hundreds of jerseys and p is the price in dollars Find the equilibrium point Equilibrium quantity x which corresponds to jerseys I

The Bells obtain a 20 year 100 000 conventional mortgage at a 10 0 rate on a house selling for 130 000 Their monthly mortgage payment including principal and interest is 966 00 They also pay 3 points at closin a Determine the total amount the Bells will pay for their house b How much of the cost will be interest including the 3 points c How much of the first payment on the mortgage is applied to the principal www a The total amount that the Bells will pay for their house is Round to the nearest dollar as needed

The Adeeva s gross monthly income is 7600 They have 18 remaining payments of 390 on a new car They are applying for a 20 year 167 000 mortgage at 7 0 The taxes and insurance on the house are 490 per month The bank will only approve a loan that has a total monthly mortgage payment of principal interest property taxes and homeowners insurance that is less than or equal to 28 of their adjusted monthly income Click here for table of Monthly Payments a Determine 28 of the Adeeva s adjusted monthly income 2018 8 Round to the nearest cent b Determine the Adeeva s total monthly mortgage payment including principal interest taxes and homeowners insurance Round to the nearest cent

A youth sports league held various fundraisers They received 490 from a car wash 383 from a bake sale and 169 from a used equipment sale The league decides to invest this money in a 5 year CD that pays 3 1 interest compounded daily How much will the league receive from the CD in 5 years The league will have in this account after 5 years Round to the nearest cent as needed

Karen Gaines invested 14 000 in a money market account with an interest rate of 3 25 compounded semiannually Seven years later Karen withdrew the full amount to put toward the down payment on a new house How much did Karen withdraw from the account Karen withdrew Round to the nearest cent as needed

A recent high school graduate received 600 in gifts of cash from friends and relatives In addition he receive three scholarships in the amounts of 450 500 and 1100 If he takes all his gift and scholarship money and invests it in a 24 month CD paying 3 interest compounded daily how much will the graduate have when he cashes in the CD at the end of the 24 months The graduate will have when he cashes in the CD Round to the nearest cent as needed

Marcus receives an inheritance of 4 000 He decides to invest this money in a 12 year certificate of deposit CD that pays 3 5 interest compounded monthly How much money will Marcus receive when he redeems the CD at the end of the 12 years Marcus will receive Round to the nearest cent www

The Bells obtain a 30 year 130 000 conventional mortgage at a 9 5 rate on a house selling for 150 000 Their monthly mortgage payment including principal and interest is 1093 30 They also pay 2 points at closing a Determine the total amount the Bells will pay for their house b How much of the cost will be interest including the 2 points c How much of the first payment on the mortgage is applied to the principal a The total amount that the Bells will pay for their house is Round to the nearest dollar as needed

The Fritzes are buying a house that sells for 141 000 The bank is requiring a minimum down payment of 10 To obtain a 35 year mortgage at 9 0 interest they must pay 2 points at the time of closing a Determine the required down payment b Determine the amount of the mortgage on the property with the 10 down payment c Find the cost of 2 points on the mortgage a The required down payment is

Jane Roznowski wants to invest some money now to buy a new tractor in the future If she wants to hav 350 000 available in 3 years how much does she need to invest now in a CD paying 4 85 interest compounded monthly Jane needs to invest now Round to the nearest cent as needed

Adam wishes to have 18 000 available in 22 years to purchase a new car for his son as a gift for his college graduation To accomplish this goal how much should Adam invest now in a CD that pays 1 61 interest compounded quarterly Adam should invest now Round to the nearest cent as needed www

Dante wants to buy a bond that will mature to 6000 in six years How much should he pay for the bond now if it earns interest at a rate of 3 5 per year compounded continuously Do not round any intermediate computations and round your answer to the nearest cent X S

Chou Co has a net income of 58 000 assets at the beginning of the year are 265 000 and assets at the end of the year are 315 000 Compute its return on assets Multiple Choice O O O C 11 1 21 9 18 4 20 0 1 9

In the simple interest formula S P 1 rt find S when P 1500 r 0 075 and 1 127 365

What would happen if when entering a transaction from June 2 you accidentally transposed the numbers and entered 560 0 instead of 650 How would you correct the entry on June 25 Use the link to go to the Journal and record the correcting entr Go to General Journal What If Answer each question in 3 5 complete sentences How can totaling the debits and credits in the journal help you What action would you take if the totals do not match

For this question you should type which formula you should use simple compound annuity payout annuity loan You should also tell me which variable you will be solving for and you should type your final answer to two decimal places ALL OTHER WORK MUST BE ON PAPER YOU SEND TO ME so I can see you substituted into the equation properly and the steps you took to solve How much should be invested now at 3 25 simple interest if 7550 is needed in 4 years 6 months Formulas

For this question you should type which formula you should use simple compound annuity payout annuity loan You should also tell me which variable you will be solving for and you should type your final answer to two decimal places ALL OTHER WORK MUST BE ON PAPER YOU SEND TO ME so I can see you substituted into the equation properly and the steps you took to solve Calculate the present value of an account if the future value is 25 000 after 9 years at 4 if the interest is compounded monthly

A DVD rental company has 10 500 000 subscribers an increase of 140 from five years ago Find the number of subscribers five years ago

Part 1 Every year after a new car is purchased it loses 25 of its value The purchase price of the c is 24 000 A buyer worries that the car will be worth nothing in 4 years Do you agree a b If you disagree what will be the value of the car in years 5 and 10

4 35 U 2 expression equation Identify the variables coefficients and constants Enter your answers as a comma separated list If there is no answer enter NONE variables Classify coefficients constants as an algebraic expression or an equation

What is the effective interest rate per quarter if the interest rate is 7 compounded monthly The effective interest rate per quarter is Round to three decimal places

Clay Harden borrowed 24 000 from a bank at an interest rate of 10 compounded monthly The loan will be repaid in 48 equal monthly installments over four years Immediately after his 20th payment Clay desires to pay the remainder o the loan in a single payment Compute the total amount he must pay The total amount Clay must pay immediately after his 20th payment will be Round to the nearest dollar

Your company wants to set aside a fixed amount every year to a sinking fund to replace a piece of industrial equip costing 248 000 at the end of three years from now The sinking fund is expected to earn 4 interest How much your company deposit each year to meet this goal Click the icon to view the interest factors for discrete compounding when i 4 per year Your company nust deposit each year to meet this goal Round to the nearest dollar

Joe s starting salary as a mechanical engineer is around 80 000 Joe is planning to place a total of 8 of his salary each year in mutual funds Joe expects a 4 salary increase each year for the next 25 years of employment If mutu funds will average 6 annual return over the course of his career what can Joe expect at retirement Click the icon to view the interest factors for discrete compounding when i 6 per year The amount Joe can expect at retirement is Round to the nearest dollar

What is the equal payment series for 12 years that is equivalent to a payment series of 15 000 at the end of t first year decreasing by 1 000 each year over 12 years Interest is 8 compounded annually Click the icon to view the interest and annuity table for discrete compounding when 8 per year The equal payment series equivalent is Round to the nearest dollar

You have borrowed 50 000 at an interest rate of 12 Equal payments will be made over a three year period The fi payment will be made at the end of the first year What will the annual payment be and what will the interest paymen be for the second year Click the icon to view the interest factors for discrete compounding when i 12 per year

What is the present worth of these future payments a 25 500 eight years from now at 12 compounded annually b 58 000 twelve years from now at 4 compounded annually c 25 000 nine years from now at 6 compounded annually d 35 000 four years from now at 9 compounded annually Click the icon to view the interest factors for discrete compounding when i 4 per year Click the icon to view the interest factors for discrete compounding when i 6 per year Click the icon to view the interest factors for discrete compounding when i 9 per year Click the icon to view the interest factors for discrete compounding when i 12 per year a The present worth is Round to the nearest dollar

You are about to borrow 15 000 from a bank at an interest rate of 8 compounded annually You are required to make three equal annual repayments in the amount of 5 820 50 per year with the first repayment occurring at the end of ye 1 Show the interest payment and principal payment in each year Fill in the table below Round to the nearest cent End of Year 0 Principal Repayment Interest payment Remaining Balance

If you open a savings account that earns 5 5 simple interest per year what is the minimum number of years you must wait to double your balance Suppose you open another account that earns 5 interest compounded yearly How many years will it take now to double your balance The minimum number of years you must wait to double your balance is the nearest whole number for the simple interest of 5 5 Round up to

Use a periodic rate of 1 5 and the unpaid balance method to compute the unpaid balance finance charge and new balance Round to the nearest cent Previous Balance 350 00 125 50 437 50 Payments Credits 75 00 Unpaid Balance 57 50 275 45 50 80 380 Finance Charge 4 13 1 20 5 70 New Purchases 90 00 42 50 222 50 New Balance 369 13 1 0 0 X

Kwami Endabe s charge account uses the unpaid balance method The periodic rate is 1 85 The previous balance is 478 68 He had payments of 150 and 60 and an 89 95 credit He has new purchases of 38 50 65 74 and 125 61 The new balance rounded to the nearest cent is x

Previous Balance 1280 payment 200 new purchases 52 and 48 periodic rate 1 6 The new balance rounded to the nearest cent is x