Business 038 - Business Computations » Spring 2021 » Final Exam
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Question #1
Using the table in your handbook, $6,000 for six years at 8½% compounded daily will grow to:
A.
8950.1
B.
9990.02
C.
9991.2
D.
None of these
E.
8991.02
Question #2
Using the table in the handbook, the present value of $12,000 for six years compounded at 6% semiannually is:
A.
12814.08
B.
8416.8
C.
$8,661.80
D.
8614.8
E.
None of these
Question #3
$20,000 for 14 years compounded at 8% semiannually results in how many periods?
A.
28
B.
64
C.
None of these
D.
12
E.
14
Question #4
$100,000 for 20 years compounded at 4% annually results in a rate per period of:
A.
5%
B.
4%
C.
1%
D.
3%
E.
None of the above
Question #5
Sam Monte deposits $21,500 into Legal Bank, which pays 6% interest that is compounded semiannually. Using the table in the handbook, what will Sam have in his account at the end of six years?
A.
30456.07
B.
29760.3
C.
None of these
D.
30654.7
E.
29670.03
Question #6
Merle Fonda opened a new savings account. She deposited $40,000 at 10% compounded semiannually. At the start of the fourth year, Merle deposits an additional $20,000 that is also compounded semiannually at 10%. At the end of six years, the balance in Merle's account is (use the tables in the handbook):
A.
53604.00
B.
80406.00
C.
98636.72
D.
73604
E.
None of the above
Question #7
J. Ryan discounts an 80-day note for $15,000 at 12%. The bank discount is (assume ordinary interest):
A.
15,000
B.
400
C.
14,600
D.
15,400
E.
None of the above
Question #8
The maturity value of a $20,000, 7%, 75-day interest-bearing note dated September 10 is:
A.
$22,291.67
B.
None of these
C.
$21,029.67
D.
$22,219.76
E.
$20,291.67
Question #9
Jay discounts a 100-day note for $25,000 at 13%. The effective rate of interest to the nearest hundredth percent is:
A.
None of these
B.
13.03%
C.
13.49%
D.
13.48%
E.
13.02%
Question #10
Jill Corporation accepted a $16,000 note on Aug. 12. Terms of the note were 13% for 100 days. Jill discounted the note on September 28 at the Reno Bank at 14%. The proceeds to Jill would be:
A.
$341.69
B.
$303.00
C.
$16,236.09
D.
$16,277.78
E.
None of these
Question #11
On March 12, Bill Jones accepted a $12,000 note in granting a time extension of a bill for goods purchased by Ron Prentice. Terms of the note were 13% for 90 days. On April 24, Bill could no longer wait for the money and discounted the note at Able Bank at a discount rate of 14%. The proceeds to Bill is:
A.
None of these
B.
$12,163.54
C.
$12,047.90
D.
$12,048.90
E.
$12,390.00
Question #12
A note dated August 18 and due on March 9 runs for exactly:
A.
272 days
B.
203 days
C.
230 days
D.
None of these
E.
227 days
Question #13
An 8% 13-week Treasury bill would have an effective interest rate of (to the nearest hundredth percent)? Assume it is a $10,000 Treasury bill.
A.
8.16%
B.
9.00%
C.
8.17%
D.
None of these
E.
8.20%
Question #14
Tiffany purchased a $10,000, 13-week Treasury bill that is paying 2.25%. What is the effective rate on this T-bill?
A.
2.0%
B.
2.2%
C.
2.7%
D.
2.26%
E.
None of these
Question #15
Simple interest usually represents a loan of:
A.
None of these
B.
One month or less
C.
One year or less
D.
Six months or less
E.
Two years or less
Question #16
Ralph Corporation accepted a $15,000, 11%, 120-day note dated August 19 from Jay Company in settlement of a past bill. On October 20, Ralph Corporation decided to discount the note at a discount rate of 12%. The proceeds to Ralph Corporation is:
A.
$1,517.97
B.
$15,249.37
C.
$15,249.73
D.
None of these
E.
$1,517.79
Question #17
United Missouri Bank discounts a 120-day note for $60,000 at 6.75%. It uses 360 days in a year. What is the bank discount?
A.
$1,350
B.
$1,250
C.
None of these
D.
$1,200
E.
$61,200
Question #18
A $40,000 loan at 4% dated June 10 is due to be paid on October 11. The amount of interest is (assume ordinary interest):
A.
$503.00
B.
$105.33
C.
$2,500.00
D.
$546.67
E.
None of these
Question #19
Justin discounts a 115-day note for $26,000 at 8.5%. The effective rate of interest to the nearest tenth percent is:
A.
None of these
B.
8.5%
C.
8.7%
D.
0.87%
E.
0.8%
Question #20
In calculating the bank discount when discounting an interest-bearing note, which one of the following is not used in the calculation?
A.
Principal proceeds
B.
Discount period
C.
None of these
D.
Maturity value
E.
Bank discount rate
Question #21
Amount of trade discount equals:
A.
Net price × trade discount rate
B.
None of these
C.
List price divided by trade discount rate
D.
List price + trade discount rate
E.
List price x trade discount rate
Question #22
The complement of 35% is:
A.
65%
B.
56%
C.
None of these
D.
53%
E.
165%
Question #23
Cash discounts are:
A.
Sometimes calculated with freight
B.
Sometimes calculated with returned goods
C.
None of these
D.
Always calculated on list price
E.
Never calculated on freight and returns
Question #24
In tables for calculating compound interest, the number of periods is equal to:
A.
Number of years divided by number of times compounded per year
B.
Number of years divided by rate
C.
Number of years × number of times compounded per year
D.
None of these
E.
Number of years × rate
Question #25
A simple discount note results in:
A.
None of these
B.
Interest deducted in advance
C.
Same interest costs as a simple interest note
D.
Interest deducted when note is paid back
E.
Lower interest costs than a simple interest note
Question #26
FUTA tax is paid:
A.
None of these
B.
Only weekly
C.
By both the employee and the employer
D.
By the employer
E.
By an employee
Question #27
The more allowances claimed on Form W-4:
A.
The more money deducted for FIT, no FIT ever deducted, FUTA increase and the less money deducted for FIT
B.
The less money deducted for FIT
C.
No FIT ever deducted
D.
The more money deducted for FIT
E.
FUTA increase
Question #28
Leo Corporation pays its employees on a graduated commission scale: 6% on the first $40,000 in sales, 7% on sales from $40,000 to $80,000, and 9% on sales greater than $80,000. Bernie Kaminsky had sales of $105,000. His commission is:
A.
$2,400
B.
$5,200
C.
$7,450
D.
$1,350
E.
None of these
Question #29
Ron Swift earned $1,500 last week. He is married, is paid biweekly, and claims two exemptions. Using the percentage method (use tables in the handbook), his income tax is:
A.
$109.69
B.
$100.91
C.
$140.88
D.
None of these
E.
$116.4
Question #30
Markup is:
A.
Selling price x (1 + cost)
B.
Selling price - cost
C.
Selling price + cost
D.
None of these
E.
Selling price divided by cost
Question #31
An Apple iPod sells for $299, which is marked up 40% of the selling price. The cost of the iPod is:
A.
$197.40
B.
$179.40
C.
$194.70
D.
$149.70
E.
None of these
Question #32
The markdown percent is calculated by:
A.
Sale price divided by amount of markdown
B.
Amount of markdown divided by sale price
C.
Amount of markdown divided by original selling price
D.
Original selling price divided by amount of markdown
E.
None of these
Question #33
At the end of the summer, Walgreens advertised blow-up pools for 66% off the regular price. Jeff Jones saw a pool with a regular price of $49.99. The dollar markdown is:
A.
$33.99
B.
None of these
C.
$33.39
D.
$39.29
E.
$32.99
Question #34
Deborah Erickson deposited $8,875 in a credit union, which pays an interest of 8% compounded quarterly. Compute the amount that Deborah will have in her account after 3 years.
A.
$11,255.63
B.
$11,525.63
C.
$12,556.36
D.
$12,155.36
Question #35
Keifer Air Conditioning can borrow money for 2 years at 12% compounded quarterly. Compute the interest charge if Keifer borrows $28,000 to remodel his office. (Use Tables 16-1A&B or a calculator.)
A.
$7,964.65
B.
$7,694.56
C.
$7469.56
D.
$7,496.56
Question #36
University Lending Corp. loans money to students at 10% compounded semiannually. Dwight Burch borrows $5,000 for 4 1/2 years. Compute the total amount, both principal and interest, that Dwight will be required to repay. (Use Tables 16-1A&B or a calculator.)
A.
$7,675.65
B.
$7,675.56
C.
$7,756.65
D.
$7,765.56
Question #37
A.
None of these
B.
$254.59
C.
$245.59
D.
$524.59
E.
$245.95
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