Engineering Economics MCQs Solved

Engineering Economics MCQs
1. First Benchmark Publishings gross

margin is 50% of sales. The operating
costs of the publishing are estimated at
15% of sales. If the company is within the
40% tax bracket, determine the percent of
sales is their profit after taxes?
electrically operated hydraulic guillotine

was offered to Mr. Camus at a price of
P275,000.00 and which cuts by 30% the
unit cutting cost. Disregarding the cost of
money, how many months will Mr. Camus
be able to recover the cost of the machine
if he decides to buy now?
A. 10 months
A. 21 %
B. 11 months
B. 20 %
C. 12 months
C. 19 %
D. 13 months
D. 18 %
2. A farmer selling eggs at 50 pesos a

dozen gains 20%. If he sells the eggs at
the same price after the costs of the eggs
rises by 12.5%, how much will be his new
gain in percent?
5. Engr. Trinidad loans from a loan firm an

amount of P100,000 with a rate of simple
interest of 20% but the interest was
deducted from the loan at the time the
money was borrowed. If at the end of one
year, she has to pay the full amount of
P100,000, what is the actual rate of
interest?
A. 6.89 %
B. 6.65 %
A. 23.5 %
C. 6.58 %
B. 24.7 %
D. 6.12 %
C. 25.0 %
D. 25.8 %
3. A feasibility study shows that a fixed

capital investment of P10,000,000 is
required for a proposed construction firm
and an estimated working capital of
P2,000,000. Annual depreciation is
estimated to be10% of the fixed capital
investment. Determine the rate of return
on the total investment if the annual profit
is P3,500,000.
6. A loan of P5,000 is made for a period of

15 months, at a simple interest rate of
15%, what future amount is due at the
end of the loan period?
C. 11.54 %
D. 10.29 %
8. A college freshman borrowed P2,000

from a bank for his tuition fee and
promised to pay the amount for one year.
He received only the amount of P1,920
after the bank collected the advance
interest of P80.00. What was the rate of
discount?
A. 3.67 %
B. 4.00 %
C. 4.15 %
D. 4.25 %
9. It is the practice of almost all banks in

the Philippines that when they grant a
loan, the interest for one year is
automatically deducted from the principal
amount upon release of money to a
borrower. Let us therefore assume that
you applied for a loan with a bank and the
P80,000 was approved at an interest rate
of 14% of which P11,200 was deducted
and you were given a check of P68,800.
Since you have to pay the amount of
P80,000 one year after, what then will be
the effective interest rate?
A. 16.02 %
B. 16.28 %
A. 5,937.50
C. 16.32 %
B. 5,873.20
D. 16.47 %
A. 28.33 %
C. 5,712.40
B. 29.17 %
D. 5,690.12
C. 30.12 %
D. 30.78 %
4. The monthly demand for ice cans being

manufactured by Mr. Camus is 3200
pieces. With a manual operated guillotine,
the unit cutting cost is P25.00. An
7. Mr. Bacani borrowed money from the

bank. He received from the bank P1,842
and promised to repay P2,000 at the end
of 10 months. Determine the rate of
simple interest.
A. 12.19 %
B. 12.03 %
10. A man invested P110,000 for 31 days.

The net interest after deducting 20%
withholding tax is P890.36. Find the rate
of return annually.
A. 11.50 %
B. 11.75 %
C. 11.95 %
D. 12.32 %
11. A investor wishes to earn 7% on his

capital after payment of taxes. If the
income from an available investment will
be taxed at an average rate of 42%, what
minimum rate of return, before payment of
taxes, must the investment offer to be
justified?
A. 3.90 %
B. 3.92 %
C. 3.95 %
D. 3.98 %
A. 12.07 %
B. 12.34 %
C. 12.67 %
A. P39.01
D. 12.87 %
B. P39.82
C. P39.45
D. P39.99
12. Mr. Jun Ramos was granted a loan of

P20,000 by his employer Excel First
Review and Training Center, Inc. with an
interest of 6% for 180 days on the
principal collected in advance. The
corporation would accept a promissory
note for P20,000 non-interest for 180
days. If discounted at once, find the
proceeds of the note.
15. What is the ordinary interest on

P1,500.50 for 182 days at 5.2%?
16. A loan for P50,000 is to be paid in 3

years at the amount of P65,000. What is
the effective rate of money?
A. 9.01 %
B. 9.14 %
A. P18,000
C. 9.31 %
B. P18,900
D. 9.41 %
C. P19,000
D. P19,100
13. Miss Evilla borrowed money from a

bank. She receives from the bank
P1,340.00 and promised to pay P1,500.00
at the end of 9 months. Determine the
corresponding discount rate or often
referred to as the bankers discount.
A. 13.15 %
B. 13.32 %
C. 13.46 %
D. 13.73 %
14. The exact simple interest of P5,000

invested from June 21, 1995 to December
25, 1995 is P100. What is the rate of
interest?
17. What is the effective rate

corresponding to 18% compounded daily?
Take 1 year is equal to 360 days.
A. 19.61 %
B. 19.44 %
C. 19.31 %
D. 19.72 %
18. What rate of interest compounded

annually is the same as the rate of
interest of 8% compounded quarterly?
A. 8.07 %
B. 8.12 %
C. 8.16 %
D. 8.24 %
19. Which of these gives the lowest

effective rate of interest?
A. 12.35 % compounded
annually
B. 11.90 % compounded
annually
C. 12.20 % compounded
annually
D. 11.60 % compounded
annually
20. An amount of P1,000 becomes

P1,608.44 after 4 years compounded
bimonthly. Find the nominal interest.
A. 11.89 %
B. 12.00 %
C. 12.08 %
D. 12.32 %
21. How long will it take money to double

itself if invested at 5% compounded
annually?
A. 13.7 years
B. 14.7 years
C. 14.2 years
D. 15.3 years
22. 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 it amounts to
P50,000. When will the girl receive the
money if fund invested at 8%
compounded quarterly?
A. 11.23 years
B. 11.46 years
C. 11.57 years
D. 11.87 years
23. A sum of P1,000 is invested now and
left for eight years, at which time the
principal is withdrawn. The interest has

accrued is left 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?
D. P37.56
27. What is the present worth of two P

100 payments at the end of the third year
and fourth year? The annual interest rate
is 8%.
B. The construction of a smaller building

now to cost P300,000 and at the end of 5
years, an extension to be added to cost P
200,000.
C. P 2,540.56
D. P 2,504.57
34. What is the present worth of a year

annuity paying P 3,000.00 at the end of
each year, with interest at 8%
compounded annually?
A. P693.12
B. P700.12
A. P 150.56
C. P702.15
B. P 152.88
A. P 19,122.15
A. P 7,654.04
D. P705.42
C. P 153.89
B. P 19,423.69
B. P 7,731.29
D. P 151.09
C. P 19,518.03
C. P 7,420.89
D. P 19,624.49
D. P 7,590.12
24. Mandarin Bank advertises 9.5%

account that yields 9.84% annually. Find
how often the interest is compounded.
28. A firm borrows P2,000 for 6 years 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 lump sum
due?
A. Monthly
B. Bimonthly
C. Quarterly
A. P 3,260.34
D. Annually
B. P 3,280.34
C. P 3,270.34
D. P 3,250.34
25. A student plans to deposit P1,500 in

the bank now and another P3,000 for the
next 2 years. If he plans to withdraw
P5,000 three years from after his last
deposit for the purpose of buying shoes,
what will be the amount of money left in
the bank after one year of his withdrawal?
Effective annual interest rate is 10%.
A. P1,549.64
B. P1,459.64
C. P1,345.98
D. P1,945.64
26. You borrow P3,500.00 for one year

from a friend at an interest rate of 1.5%
per month instead of taking a loan from a
bank at a rate of 18% per year. How much
lesser you will pay by borrowing the
money from the bank?
A. P 62.44
B. P44.55
C. P54.66
29. In year zero, you invest P 10,000.00 in

a 15% security for 5 years. During that
time, the average annual inflation is 6%.
How much in terms of year zero pesos will
be in the account at maturity?
A. P 15,030.03
B. P 20,113.57
C. P 18,289.05
D. P 16,892.34
30. The institute of Electronics and

Communications Engineers of the
Philippines (IECEP) is planning to put up
its own building. Two proposals being
considered are:
A. The construction of the building now to
cost P 400,000
By how much is proposal B more

economical than proposal A if interest rate
is 20% and depreciation to be neglected?
31. 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. A man loans P 187,400 from a bank

with interest at 5% compounded annually.
He agrees to pay his obligations by
paying 8 equal annual payments, the first
being due at the end of 10 years. Find the
annual payments.
A. P 727.17
B. P 717.17
A. P 43,600.10
C. P 714.71
B. P 43,489.47
D. P 731.17
C. P 43,263.91
D. P 43,763.20
32. What annuity is required over 12

years to equate with a future amount of P
20,000? Assume i= 6% annually.
A. P 1,290.34
B. P 1,185.54
C. P 1,107.34
D. P 1,205.74
33. A factory operator bought a diesel

generator set for P 10,000.00 and agreed
to pay the dealer uniform sum at the end
of each year for 5 years at 8% interest
compounded annually, that the final
payment will cancel the debt for principal
and interest. What is the annual payment?
A. P 2,500.57
B. P 2,544.45
36. A person buys a piece of lot for P

100,000 downpayment and 10 deferred
semi-annual payments of P 8,000 each,
starting three years from now. What is the
present value of the investment if the rate
of interest is 12% compounded semiannually?
A. P 142,999.08
B. P 143,104.89
C. P 142,189.67
D. P 143,999.08
37. A young engineer borrowed P 10,000

at 12% interest and paid P 2,000 per
annum for the last 4 years. What does he
have to pay at the end of the fifth year in
order to pay off his loan?
A. P 6,999.39
B. P 212.90
B. P 6,292.93
C. P 236.20
C. P 6,222.39
D. P 231.56
D. P 6,922.93
38. Miss Calledo deposited P 1,000, P
1,500 and P 2,000 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 of the 4th year?
42. A machine costs of P 8,000 and an

estimated life of 10 years with a salvage
value of P 500. What is its book value
after 8 years using straight line method?
A. P 2,000.00
A. P 4,880.00
B. P 2,100.00
B. P 4,820.00
C. P 2,200.00
C. P 4,860.00
D. P 2,300.00
D. P 4,840.00
39. A P 1,000,000 issue of 3%, 15-year

bond was sold at 95%. What is the rate of
interest of this investment?
43. ABC Corporation makes it a policy

that for any new equipment purchased,
the annual depreciation cost should not
exceed 20% of the first cost at any time
with no salvage value. Determine the
length of service life necessary if the
depreciation used is the SYD method.
A. 3.0%
B. 3.4%
C. 3.7%
B. 8 years
D. 4.0%
C. 9 years
D. 10 years
40. A P 1, 000, 6% bond pays dividend

semiannually and will be redeemed at
110% on June 21, 204. It is bought on
June 21, 2001 to yield 4% interest. Find
the price of the bond.
A. Economic Analysis
B. 1.2 hours per unit
B. Engineering cost analysis
A. P 9,358.41
C. 1.4 hours per unit
C. Engineering economy
B. P 9,228.45
D. 1.6 hours per unit
D. Design cost analysis
C. P 9,250.00
D. P 9,308.45
46. The Saudi Arabian Oil Refinery

developed an oil well which is estimated
to contain 5,000,000 barrels of oil at an
initial cost of $ 50,000,000. What is the
depletion charge during the year where it
produces half million barrels of oil? Use
Unit or Factor method in computing
depletion.
49. A telephone switchboard 100 pair

cable can be made up with either
enameled wire or tinned wire. There will
be 400 soldered connections. The cost of
soldering a connection on the enameled
wire will be P 1.65 on the tinned wire, it
will be P 1.15. A 100- pair cable made up
with enameled wire cost P 0.55 per linear
foot and those made up of tinned wire
cost P 0.75 per linear foot. Determine the
length of cable run in feet so that the cost
of each installation would be the same.
D. Cash or check
53. What is defined as any tangible

economic product that contributes directly
or indirectly to the satisfaction of human
want?
B. 1,040 feet
A. Services
C. $ 5,025,000.00
C. 1,100 feet
B. Goods
D. $ 5,050,000.00
D. 1,120 feet
C. Commodities
D. Goods or commodities
47. A manufacturer produces certain items

at a labor cost of P 115 each, material
cost of P 76 each and variable cost of P
2.32 each. If the item has a unit price of P
600, how many units must be
manufactured each month for the
manufacturer to break even if the monthly
overhead is P428,000
50. A leading shoe manufacturer produces

a pair of Lebron James signature shoes at
a labor cost of P 900.00 a pair and a
material cost of P 800.00 a pair. The fixed
charges on the business are P 5,000,000
a month and the variable costs are P
400.00 a pair. Royalty to Lebron James is
P 1,000 per pair of shoes sold. If the
shoes sell at P 5,000 a pair, how many
pairs must be produced each month for
the manufacturer to break-even?
A. 2.590
B. P 3,927.27
D. 1,053
B. 2,632
C. P 3,729.27
C. 2,712
D. P 3,792.72
D. 2,890
45. Shell Philippines, a multinational

company, has a total gross income for a
particular year of P 50,000,000. The
taxable income after taking all deductions
except for depletion is P 18,500,000.
C. Foreign exchange
D. P 1,155.06
A. 1,000 feet
C. 1,043
B. Currency
C. P 1,133.78
B. $ 5,010,000.00
A. P 3,279.27
A. Monetary unit
B. 1,037
A. $ 5,000,000.00
B. P 1,144.81
52. What is considered as the standard

unit which forms the basis of a countrys
domestic money supply?
A. 1,033
A. P 222.67
A. 1.0 hour per unit
A. P 1,122.70
A. 7 eyars
44. An asset is purchased for P 9,000.00.

Its estimated 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
41. A VOM has a selling price of P 400. If

its selling price is expected to decline at a
rate of 10% per annum due to
obsolescence, what will be its selling price
after 5 years?
What is the allowable depletion allowance

for that particular year? Take percentage
of gross income for oil as 22%.
48. A manufacturing firm maintains one

product assembly line to produce signal
generators. Weekly demand for the
generators is 35 units. The line operates
for 7 hours per day, 5 days per week.
What is the maximum production time per
unit in hours required of the line to meet
the demand?
51. What is defines as the analysis and

evaluation of the monetary consequences
by using the theories and principles of
economics to engineering applications,
designs and projects?
54. What is defined as any tangible

economic activity that contributes directly
or indirectly to the satisfaction of human
want?
A. Services
B. Goods
C. Commodities
D. Goods or commodities
55. What are the two classifications of

goods and services?
A. Local and imported
B. Raw and finished
C. Consumer and producer
D. Ready-made and made-toorder
56. What refers to the goods and services

that are required to support human life,
needs and activities?
61. What is a market situation whereby

there is only one buyer of an item for
which there is no goods substitute?
A. Producer products
B. Consumer products
C. Luxury
D. Necessity
57. What refers to the goods and services

that are desired by human and will be
acquired only after all the needs have
been satisfied?
D. Buyer or consumer
A. Duopsony
A. Monopsony
B. Oligopoly
A. Perfect competition
B. Monopoly
C. Oligopsony
B. Oligopoly
C. Oligopoly
D. Monopoly
C. Oligopsony
D. Oligopsony
D. Monopoly
62. What market situation exists where

there are few sellers and few buyers?
A. Producer products
A. Oligopoly
B. Consumer products
B. Oligopsony
C. Luxury
C. Bilateral oligopoly
D. Necessity
D. Bilateral Oligopsony
63. What market situation exists where

there is only one buyer and only one
seller?
A. Monopsony
A. Mall
B. Monopoly
B. Market
C. Bilateral monopsony
C. Store
D. Bilateral monopoly
D. Office
59. What is considered as the basic

consuming or demanding unit of a
commodity?
64. What is the market situation exist

when there are many buyers and many
sellers?
A. Seller
B. Oligopoly
B. Manufacturer
C. Oligopsony
C. Producer
D. Monopoly
D. Buyer or consumer
60. What is defined as an entity which

makes product, good or services available
to buyer or consumer in exchange of
monetary consideration?
71. What refers to the market situation in

which any given product is supplied by a
very large number of vendors and there is
no restriction against additional vendors
from entering the market?
58. What refers to the exchange

mechanism that brings together the
sellers and the buyers of a product, factor
of production or financial security?
66. If there are many sellers and few

buyers, the market situation is _________
.
65. If there is only one seller and many

buyers, the market situation is ________ .
67. Oligopoly exists when there is/are:
A. Few sellers and few buyers
B. Few sellers and many

buyers
C. Many sellers and few

buyers
D. One seller and few buyers
72. Aside from many sellers and many

buyers, which one is a characteristic of
perfect competition?

buyers

buyers
B. Law of supply
C. Law of demand
D. All of the above
D. Law of supply and demand
73. What is the opposite of perfect

competition?
D. Monopoly
70. What is another term for perfect

competition?
A. Duopsony
B. Oligopoly
A. Atomistic competition
A. Seller
C. Oligopsony
B. No-limit competition
B. Manufacturer
D. Monopoly
C. Free-for-all competition
C. Producer
D. Heterogeneous market
76. When one of the factors of production

is fixed in quantity or is difficult to
increase, increasing the other factors of
production will result in a less than
proportionate increase in output. This
statement is known as the:
69. Duopoly is a market situation where

there is/are:
D. Ordinary monopoly
C. Perfect information and

absence of all economic
friction
C. Oligopsony

buyers
C. Natural monopoly
A. Law of diminishing return

buyers
B. Oligopoly
B. Bilateral monopoly
B. Free market entry and exit
A. Monopsony
A. Perfect monopoly
A. Homogeneous product
68. Duopsony is a market situation where

there is/are:
output of an industry is supplied by a

single producer so that the supply costs
are lower under monopoly that under
perfect competition.
74. Perfect monopoly exists only if:
A. the single vendor can

prevent the entry of all other
vendors in the market
77. What refers to the need, want or

desire for a product backed by the money
to purchase it?
A. Supply
B. Demand
C. Product
D. Good
78. What refers to the amount of a

product made available for sale?
A. Supply
B. the single vendor gets the

absolute franchise of the
product
B. Demand
C. Product
C. the single vendor is the only

one who has the permit to sell
D. Good
D. the single vendor is the only

one who has the knowledge of
the product
75. A ______ is a market situation where

economies of scale are so significant that
cost are only minimized when the entire
79. Under conditions of perfect

competition, the price at which any given
product will be supplied and purchased is
the price that will result in the supply and
the demand being equal. This statement
is known as the:
B. Law of supply
C. Time value of money
B. Nominal rate of interest
C. Annuity due
A. Par value of bond
C. Law of demand
D. Yield
C. Compound interest
D. Deferred annuity
B. Face value of bond
D. Simple interest
95. What is the type of annuity that does

not have a fixed time span but continues
indefinitely or forever?
C. Redeemed value of bond
D. Value of bond
80. What do you call any particular raw

material or primary product such as cloth,
wool, flour, coffee, etc.?
85. The difference between the present

and future worth of money at some time in
the future is called ______.
A. Discount
90. What refers to the cost of borrowing

money or the amount earned by a unit
principal per unit time?
A. Ordinary annuity
100. What is defined as the certificate of

indebtedness of corporation usually for a
period not less than 10 years and
guaranteed by a mortgage on certain
assets of a corporation?
A. Utility
B. Deduction
A. Yield rate
B. Perpetuity
B. Necessity
C. Inflation
B. Rate of return
C. Annuity due
C. Commodity
D. Depletion
C. Rate of interest
D. Deferred annuity
A. Bond
D. Stock
D. Economic return
96. What is the type of annuity where the

first payment does not begin until some
later date in the cash flow?
B. T-bills
C. Stock
81. What is defined as the interest on a

load or principal that is based only on the
original amount of the loan or principal?
A. Effective rate of interest
B. Nominal rate of interest
C. Compound interest
D. Simple interest
82. Under ordinary simple interest, how

many days in one year?
A. 300
B. 360
C. 365
D. 366
83. One bankers year is equivalent to

______ days.
A. 300
B. 360
C. 365
D. 366
84. What refers to the cumulative effect of

elapsed time on the money value of an
event, based on the earning power of
equivalent invested funds capital should
or will earn?
A. Present worth factor
B. Interest rate
86. What refers to the present worth of the

probable future net earnings?
91. A uniform series of payment occurring

at equal interval of time is called ______.
A. Total fair value
B. Total market value
A. Annuity
C. Going concern value
B. Amortization
D. Earning value
C. Depreciation
87. What refers to the amount of money

paid for the use of borrowed capital?
D. Bond
92. What is the term for an annuity with a

fixed time span?
A. Interest
B. Rate of interest
A. Ordinary annuity
C. Simple interest
B. Perpetuity
D. Principal
C. Annuity certain
D. Annuity due
88. What refers to the ratio of the interest

payment to the principal for a given unit of
time and usually expressed as a
percentage of the principal?
A. Return of investment
B. Interest rate
C. Yield
D. Rate of return
89. What is defined as the investment of

loan or principal which is based not only
on the original amount of the loan or
principal but the amount of loaned or
principal plus the previous accumulated
interest?
A. Effective rate of interest

payments are made at the end of each
period starting from the first period?
A. Ordinary annuity
B. Perpetuity
C. Annuity due
D. Deferred annuity
97. 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 the first
period.
D. Compound interest is paid

on all amounts in the annuity.
A. Ordinary annuity
B. Perpetuity
C. Annuity due
D. Deferred annuity
A. T-bills

payments are made at the beginning of
the each period starting from the first
period?
B. Securities
C. Bond
D. Bank notes
A. Ordinary annuity
B. Perpetuity
98. What is defined as a financial security

note issued by business or corporation
and by the government as a means of
borrowing long-term fund?
99. What refers to the present worth of all

the amount the bondholder will receive
through his possession of the bond?
D. Promissory note
101. What refers to a document that
shows proof of legal ownership of a
financial security?
A. Bond
B. Bank note
C. Coupon
D. Check
102. What type of bond is issued jointly by
two or more corporations?
A. Mortgage bond
B. Joint bond
C. Tie-up bond
D. Trust bond
103. What type of bond whose guaranty is
in lien on railroad equipment, such as
freight and passenger cars, locomotives,
etc.?
A. Railroad bond
B. Equipment obligation bond
C. Equipment bond
D. Equipment trust bond

104. A type of bond to which are attached
coupons indicating the interest due and
the date when such interest is to be paid
is called ______.
A. Registered bond
B. Coupon bond
C. Mortgage bond
D. Collateral trust bond

105. What bond whose security is a
mortgage on certain specified assets of
the corporation?

A. Registered bond
B. Collateral trust bond
C. Mortgage bond
D. Debenture bond
106. A bond without any security behind
them except a promise to pay by the
issuing corporation is called ______.
A. Joint bond
B. Debenture bond
C. Trust bond
D. Common bond
107. A type of bond where the corporation
pledges securities which it owns such as
the stock or bonds of one of its
subsidiaries.
A. Mortgage bond
B. Joint bond
C. Security bond
D. Collateral trust bond

108. What type of bond where the
corporations owner name are recorded
and the interest is paid periodically to the
owners with their asking for it?
A. Preferred bond
B. Registered bond
C. Incorporators bond
D. Callable bond
109. What type of bond which can be
redeemed before maturity date?
A. Preferred bond
B. Registered bond
C. Incorporators bond
D. Callable bond
110. What is the feature of some bonds
whereby the issuer can redeem it before it
matures?
A. Return clause
B. Callability
C. Recall clause
D. Call class
111. The price at which the callable bond
will be redeemed from the bondholder is
called ______.
A. Par value
B. Call value
C. Face value
D. Redemption value
112. What is defined as the reduction or

fall of the value of an asset due to
constant use and passage of time?
A. Depletion
B. Inflation
C. Depreciation
D. Deflation
113. In what method of computing
depreciation where it assumes that the
loss in value is directly proportional to the
age of the equipment or asset?
A. Straight line method
B. Sinking fund method
C. Sum-of-year digit method
D. Declining balance method

depreciation where it assumes that a
sinking fund is established in which funds
will accumulate for replacement
purposes?

depreciation where it assumes that the
annual cost of depreciation is a fixed
percentage of the book value at the
beginning of the year?

116. In SYD method of computing
depreciation, which of the following is the
formula in finding the sum of years digits?
A.
B.
C.
D.
117. The declining balance method is also
known as ______.
A. Double percentage method
B. Constant percentage
method
C. Modified sinking fund

method
D. Modified SYD method

118. What type of depreciation is due to
the reduction in the demand for the
function that the equipment or asset was
designed to render?
A. Functional depreciation
B. Design depreciation
C. Physical depreciation
D. Demand depreciation
119. What type of depreciation is due to
the reduction of the physical ability of an
equipment or asset to produce results?
A. Functional depreciation
B. Design depreciation
C. Physical depreciation
D. Demand depreciation
120. The functional depreciation is
sometimes called ______.
A. Demand depreciation
B. Adolescence
C. Life depreciation
D. Failure depreciation
121. What is defined as the reduction of
the value of certain natural resources
such as mines, oil, timber, quarries, etc.
due to the gradual extraction of its
contents?
A. Depletion
B. Inflation
C. Depreciation
D. Deflation
122. What are the common methods of
computing depletion charge?
A. Rational method and

irrational method
B. Conservative method and

conventional method
C. Unit method and

percentage method
D. Discrete method and

depletion allowance method
123. Under the depletion allowance
method in computing depreciation, the
depletion charge is equal to either ______
whichever is smaller.
A. Fixed percentage of gross

income or the net taxable
income
B. Fixed percentage of gross

income or 50% of the net
taxable income
C. 50% of the fixed percentage

of gross income or 50% of the
net taxable income
D. 50% of the fixed percentage

of gross income or the net
taxable income
124. The depletion allowance method of
computing depletion is commonly known
as ______.
A. Unit method
B. Percentage method
C. Factor method
D. Sinking fund method

125. What is another term for unit
method for computing depletion?
A. Initial cost method
B. Percentage method
C. Factor method

126. Using factor method, the depletion at
any given year is equal to:
A. Initial cost of property times

number of unit sold during the
year divided by the total units
in property
B. Initial cost of property

divided by the number of units
sold during the year
C. Initial cost of property times

number of units sold during the
year
D. Initial cost of property

divided by the total units in
property
127. What do you call the after-tax
present worth of all depreciation effects
over the depreciation period of the asset?
A. Asset recovery
B. Depreciation recovery
C. Period recovery
D. After-tax recovery
128. A mathematical expression also
known as the present value of annuity of
one is called ______.
A. Load factor
B. Demand factor
C. Sinking fund factor
D. Present worth factor

129. The amount of property in which a
willing buyer to a willing seller for the
property when neither one is under the
compulsion to buy nor to sell is called
______.
A. Fair value
B. Market value
C. Good will value
D. Book value
130. Salvage value is sometimes known
as ______.
A. Scrap value
B. Going value
C. Junk value
D. Second-hand value
131. What refers to the value of an asset
which a disinterested third party, different
from the buyer and seller, will determine in
order to establish a price acceptable to
both parties?
A. Book value
B. Market value
C. Fair value
D. Franchise value
132. What refers to the value of an
intangible item which arises from the
exclusive right of a company to provide a
specified product and service in a certain
region of the country?
A. Company value
B. Going value
C. Goodwill value
D. Franchise value
133. The first cost to be incurred if the
piece of equipment now in place had been
bought for a second hand dealer or some
other business is called ______.
A. Material cost
B. Fixed cost
C. First cost
D. In-place value
134. In computing depreciation of an
equipment, which of the following
represents the first cost?
A. The original purchase price

and freight charges

B. Installation expenses
C. Initial taxes and permit fees
D. All of the above

135. The process of determining the value
or worth of a physical property for specific
reason is called ______.
A. Investment
B. Valuation
C. Economy
D. Depletion
136. The unrecovered depreciation which
results due to poor estimates as to the life
of the equipment is called ______.
A. Sunk cost
B. Economic life
C. In-place value
D. Annuity
137. What refers to the present worth of
cost associated with an asset for an
infinite period of time?
A. Annual cost
B. Increment cost
C. Capitalized cost
D. Operating cost
138. Capitalized cost of a project is also
known as ______.
A. Infinite cost
B. Life cycle cost
C. Life cost
D. Project cost
139. What is normally used to compare
alternatives that accomplish the same
purpose but have unequal lives?
A. Capitalized cost method
B. Present worth method
C. Annual cost method
D. MARR
140. What method is often used in
municipal project evaluations where
benefits and costs accrue to different
segments of the community?
A. Annual cost method
B. Benefit-cost ratio
C. Rate of return method
D. EUAC
141. What refers to an imaginary cost
representing what will not be received if a
particular strategy is rejected?
A. Opportunity cost
B. Ghost cost
C. Horizon cost
D. Null cost
142. What is the main reason why the
sinking fund method of computing
depreciation is seldom used in the
industry?
A. Unstable economy
B. Rate of interest cannot be

exactly determined
C. The initial deprecation is

high
D. The initial depreciation is

low
143. What is the factor name of the
formula (1+i)^-n?
A. Uniform gradient future

worth
B. Capital recovery
C. Single payment present

worth
D. Single payment compound

amount
144. What is the factor name of the
formula [i(1+i)^n]/[((1+i)^n)-1]?
A. Uniform series sinking fund
B. Capital recovery
C. Single payment present

worth
D. Uniform gradient future

worth
145. A form of business organization in
which a person conducts his business
alone and entirely for his own profit, being
solely responsible for all its activities and
liabilities.
A. Sole proprietorship
B. Entrepreneurship
C. Partnership
D. Corporation
146. Is an artificial being created by
operation of law, having the right of
succession and the process, attributes
and properties expressly authorized by
the law or incident to its existence.
A. Corporation
B. Property
C. Partnership
D. Organization
147. What is the simplest form of

business organization?
B. Partnership
C. Enterprise
D. Corporation
148. Double taxation is a disadvantage of
which business organization?
B. Partnership
C. Corporation
D. Enterprise
149. In case of bankruptcy of a
partnership,
A. The partners are not liable

for the liabilities of the
partnership
B. The partnership assets

(excluding the partners
personal assets) only will be
used to pay the liabilities
C. The partners personal

assets are attached to the debt
of the partnership
D. The partners nay sell stock

to generate additional capital
150. Which is true about partnership?
A. It has a perpetual life.
B. It will be dissolved if one of

the partners ceases to be
connected with the
partnership.
C. It can be handed down from

one generation of partners to
another.
D. Its capitalization must be

equal for each partner.
151. Which is true about corporation?
A. It is worse type of business

organization.
B. The minimum number of

incorporators to start a
corporation is three.
C. Its life is dependent on the

lives of the incorporators.
D. The stock holders of the

corporation are only liable to
the extent of their investments.
152. Aggregation of individuals formed for
the purpose of conducting a business and
recognized by law as a fictitious person is

called ______.
A. Partnership
B. Investors
C. Corporation
D. Stockholders
153. An association of two or more
persons for the purpose of engaging into
a business for profit is called ______.
A. Entrepreneurship
B. Partnership
C. Proprietorship
D. Corporation
154. What represents the ownership of
stockholders who have a residual claim
on the assets of the corporation after all
other claims have been settled?
A. Authorized capital stock
B. Preferred stock
C. Incorporator stock
D. Common stock
155. What stock represents ownership
and enjoys certain preferences than
ordinary stock?
A. Authorized stock
B. Preferred stock
C. Incorporators stock
D. Presidential stock
156. The amount of companys profit that
the board of directors of the corporation
decides to distribute to ordinary
shareholders is called ______.
A. Dividend
B. Return
C. Share of stock
D. Equity
157. What refers to the residual value of a
companys assets after all outside
liabilities (shareholders excluded) have
been allowed for?
A. Dividend
B. Equity
C. Return
D. Par value
158. What refers to the claim of anyone to
ownership?
A. Proprietorship
B. Assets
C. Equity
D. Liability
159. Cash money and credit necessary to
establish and operate an enterprise are
generally called ______.
A. Capital
B. Funds
C. Assets
D. Liabilities
160. What represents the share of
participation in business organizations?
A. Franchise
B. Partnership
C. Stock
D. Corporation
161. The profit derived from a project or
business enterprise without consideration
of obligations to financial contributors and
claims of others based on profit is known
as ______.
A. Yield
B. Economic return
C. Earning value
D. Gain
162. ______ is the element of value which
a business has earned through the
favorable consideration and patronage of
its costumers arising from its well known
and well conducted policies and
operations.
A. Status company
B. Big income
C. Known owners
D. Goodwill
163. Which of the following is an example
of intangible asset?
A. Cash
B. Investment in subsidiary
companies
C. Furnitures
D. Patents
164. Lands, buildings, plants and
machineries are example of what type of
asset?
A. Current asset
B. Trade investment asset
C. Fixed asset
D. Intangible asset
165. What refers to the interest rate at
which the present work of the cash flow
on a project is zero of the interest earned

by an investment?
A. Economic return
B. Yield
C. Rate of return
D. Return of investment
166. What is another term for current
assets?
A. Fixed assets
B. Non-liquid assets
C. Liquid assets
D. Ccash
167. What is an accounting term that
represents an inventory account
adjustment?
A. Cost of goods sold
B. Cost accounting
C. Standard cost
D. Overhead cost
168. What is the change in cost per unit
variable change called?
A. Variable cost
B. Incremental cost
C. Fixed cost
D. Supplemental cost
169. What is used to record historical
financial transactions?
A. Bookkeeping system
B. Ledger system
C. Balance check
D. General journal system

170. What is a secondary book of
accounts, the information of which is
obtained from the journal is called?
A. Balanced sheet
B. Ledger
C. Worksheet
D. Trial balance
171. The original record of a business
transaction is recorded in this book.
A. Work book
B. Journal
C. Ledger
D. Account book
172. All the proceeds which are received
by the business as a result of the sale of
goods is called ______.
A. Net income
B. Gross income
C. Net revenue
D. Total sales
173. All are classified under direct labor
expenses EXCEPT one. Which one?
A. Inspection cost
B. Testing cost
C. Assembly cost
D. Supervision cost
174. What is a measure of the average
speed with which accounts receivable are
collected?
A. Current ratio
B. Quick ratio
C. Acid test ratio
D. Receivable turnover
175. The ratio of the net income before
taxes to net sales is called ______.
A. Current ratio
B. Inventory turnover
C. Profit margin ratio
D. Price-earnings ratio
176. What do you call a one-time credit
against taxes?
A. Due credit
B. Tax credit
C. Credible credit
D. Revenue credit
177. What is used when a quick estimate
of the doubling time for the invested
money is needed?
A. Rule of 48
B. Rule of 36
C. Rule of 24
D. Rule of 72
178. What is the increase in the money
value of a capital asset is called?
A. Profit
B. Capital gain
C. Capital expenditure
D. Capital stock
179. What is the reduction in the money
value of capital asset is called?
A. Capital expenditure
B. Capital loss
C. Loss
D. Deficit
180. What refers to the negotiable claim
issued by a bank in lien of a term deposit?
A. Time deposit
B. Bond
C. Capital gain certificate
D. Certificate of deposit
181. What denotes in the fall in the
exchange rate of one currency in terms of
the others? This term is usually applies to
the floating exchange rate.
A. Currency appreciation
B. Currency depreciation
C. Currency devaluation
D. Currency float
182. The deliberate lowering of the price
of a nations currency in terms of the
accepted standard (Gold, American dollar
or the British pound) is known as ______.
A. Currency appreciation
B. Currency depreciation
C. Currency devaluation
D. Currency float
183. What refers to the saving which
takes place because goods are not
available for consumption rather than
consumer really want to save?
A. Compulsory saving
B. Consumer saving
C. Forced saving
D. All of the above

184. The flow back of profit plus
depreciation form a given project is called
______.
A. Capital recovery
B. Cash flow
C. Economic return
D. Earning value
185. As applied to capitalized asset, the
distribution of the initial cost by a periodic
changes to operation as in depreciation or
the reduction of a debt by either periodic
or irregular prearranged programs is
called ______.
A. Annuity
B. Amortization
C. Capital recovery
D. Annuity factor
186. Capitalized cost of any structure or
property is computed by which formula?
A. First cost + interest of first

cost
B. Annual cost interest of first

cost
C. First cost + cost of perpetual

maintenance
D. First cost + salvage value

187. The true value of interest rate
computed by equations for compound
interest for a 1 year period is known as
______.
A. Expected return
B. Nominal interest
C. Effective interest
D. Economic return
188. Return on investment ratio is the
ratio of the:
A. Net income to owners

equity
B. Market price per share to

earnings per share
C. Cost of goods sold to

average cost of inventory at
hand
D. Net credit sales to average

net receivable
189. Gross margin is the ratio of the gross
profit to ______.
A. Net sale
B. Owners equity
C. Inventory turnover
D. Quick assets
190. What is another term for acid-test
ratio?
A. Current ratio
B. Quick ratio
D. Price-earnings ratio
191. What is a government bond which
has an indefinite life rather than a specific
maturity?
A. Coupon
B. T-bill
C. Debenture
D. Consol
192. A form of business firm which is
owned and run by a group of individuals
for their mutual benefit is called ______.
A. Cooperative
B. Corporation
C. Enterprise
D. Partnership
193. What is a stock of a product which is

held by a trade body or government as a
means of regulating the price of that
product?
A. Stock pile
B. Hoard stock
C. Buffer stock
D. Withheld stock
194. The ability to meet debts as they
become due is known as ______.
A. Solvency
B. Leverage
C. Insolvency
D. Liquidity
195. The ability to convert assets to cash
quickly is known as ______.
A. Solvency
B. Liquidity
C. Leverage
D. Insolvency
196. What is the basic accounting
equation?
A. Assets = liability + owners

equity
B. Liability = assets + owners

equity
C. Owners equity = assets +

liability
D. Owners equity = liability

assets
197. The financial health of the company
is measured in terms of:
A. Liquidity
B. Solvency
C. Relative risk
D. All of the above

198. What is an index of short-term
paying ability?
A. Price-earnings ratio
B. Current ratio
D. Gross margin
199. The common ratio is the ratio of:
A. Net credit sales to average

net receivable
B. Current assets to current

liabilities
C. Gross profit to net sales
D. Net income to owners

equity
200. What is defined as the current assets
minus inventories and prepaid expenses?
A. Profit margin ratio
B. Price-earnings ratio
C. Return of investment ratio
D. Quick ratio
201. What is the ratio of the quick assets
to current liabilities?
D. Quick ratio
202. What is a measure of the average
speed with which accounts receivable are
collected?
B. Receivables turnover
D. Average age of receivables

203. Receivable turnover is the ratio of:
A. Net credit sales to average

net receivables
B. Market price per share to

earnings per share
C. Cost of goods sold to

average cost of inventory on
hand
D. Common shareholders
equity to number of
outstanding shares
204. What is the ratio of the net income to
owners equity?
A. Gross margin
B. Return of investment ratio
C. Book value per share of

common stock
D. Inventory turnover
205. What is the ratio of the market price
per share to earnings per share called?
A. Gross margin

common stock
D. Inventory turnover
206. What is the profit margin ratio?
A. The ratio of the net income

before taxes to net sales
B. The ratio of gross profit to

net sales
C. The ratio of common

shareholders equity to the
number of outstanding shares
D. The ratio of cost goods sold

to average cost of inventory on
hand
207. What is a gross margin?
A. The ratio of net income


net sales

D. The ratio of cost of goods

sold to average cost of
inventory on hand
208. Which of the following is a book
value share of common stock?


net sales


inventory on hand
209. What is an inventory turnover?


net sales


inventory on hand
210. The average age of receivables is
computed using which formula?
A. 365 / receivable turnovers
B. 365 / average net receivable
C. 365 / inventory turnover
D. 365 / average cost of

inventory on hand
211. What is a method of determining
when the value of one alternative
becomes equal to the value of another?
A. Specific identification
method
B. Average cost method
C. Break-even analysis
D. Incremental value method

212. The days supply of inventory on
hand is calculated using which formula?
A. 365 / receivable turnovers
B. 365 / average net receivable
C. 365 / inventory turnover
D. 365 / average cost of

inventory on hand
213. What is defined as the length of time
usually in years, for cumulative net annual
profit to equal the initial investment?
A. Return of investment period
B. Turnover period
C. Break-even period
D. Payback period
214. What is defined as ratio of its return
to its cost?
A. Return of an investment
B. Value of an investment
C. Breakeven point of an
investment
D. Term of an investment
215. Which of the following is an
accelerated depreciation method?
A. Straight line method and

sinking fund method
B. Straight line method and

double declining balance
method
C. Double declining balance

method and SYD method
D. SYD method and sinking

fund method
216. What is an accelerated depreciation
method?
A. It is one that calculates a

depreciation amount greater
than a straight line amount
B. It is one that calculates a

depreciation amount lesser
than a straight line amount
C. It is one that calculates a

depreciation amount equal to
straight line amount
D. It is one that calculates a

depreciation not in any way
related to straight line amount
217. What refers to the reduction in the
level of a national income and output
usually accompanied by a fall in the
general price level?
A. Deflation
B. Inflation
C. Devaluation
D. Depreciation
218. A formal organization of producers
within an industry forming a perfect
collusion purposely formed to increase
profit and block new comers form the
industry is called ______.
A. Monopoly
B. Cartel
C. Corporation
D. Competitors
219. The paper currency issued by the
central bank which forms part of the
countrys money supply is called ______.
A. T-bills
B. Bank notes
C. Check
D. Coupon
220. When one of the factors of
production is fixed in quantity or is difficult
to increase, increasing the other factors of
production will result in a less than
proportionate increase in output.
B. Law of supply
C. Law of demand

221. What is the ratio of the market price
per share to the earnings per share?
A. Inventory turnover
B. Price-earnings

common stock
D. Profit margin
222. What is the ratio of the net income to
owners equity?
A. Return on investment
B. Inventory turnover
C. Profit margin
D. Price-earnings
223. What refers to the ration of the net
income before taxes to net sales?
A. Receivable turnover
B. Acid test ratio
C. Return on investment
D. Profit margin
224. What refers to the buying or selling
of goods between two or more markers in
order to take profitable advantage of any
differences in the prices quoted in these
markets?
A. Cartel
B. Arbitrage
C. Black market
D. A priori
225. The suspension of repayment of debt
or interest for a specified period of time is
called ______.
A. Moratorium
B. Escrow
C. Numeraire
D. Porcupine
226. The discount of one unit of principal
for one unit of time.
a. Rate discount
b. Nominal discount
c. Actual discount
d. Sales discount
227. An annuity whereby the payment is
postponed for a certain period of time is?
a. Ordinary annuity
b. Suspended annuity
c. Deferred annuity
d. Annuity due
228. The actual interest earned by a given
principal is known as?
a. Compounded interest
b. Nominal interest
c. Simple interest
d. Effective interest
229. A bond where the security behind it
are the equipment of the issuing
corporation.
a. Debenture
b. Mortgage
c. Collateral
d. Lien
230. Characterized by a few supplies of a

product/services that the action by one
will almost inevitably result in the similar
action by the other.
a. Monopoly
b. Oligopoly
c. Competition
d. Necessity
231. It is the worth of a property as shown
on the accounting records.
a. Resale value
b. Face value
c. Book value
d. Written value
232. The decrease in the value of a
property due to gradual extraction of its
contents.
a. Depreciation
b. Depletion
c. Devaluation
d. Deviation
233. It is usually determined by a
disinterested third party to establish a
price good enough to both the seller and
the buyer.
a. Fair value
b. Market value
c. Common value
d. Safe value
234. The exclusive right of a company to
provide a specific product or services in a
given region of the country.
a. Outlet
b. Branch
c. Extension
d. Franchise
235. It is the sum of the first cost and the
present worth of all costs or replacement,
operation and maintenance.
a. Total cost
b. Capitalized cost
c. Initial cost
d. Variable cost
236. A certificate of indebtedness of a
corporation usually for a period not less
than 10 years and guaranteed by a
mortgage on certain assets of the
corporation or its subsidiaries.
a. Collateral
b. Bond
c. Mortgage
d. Contract
237. What the property is worth to the
owner as an operating unit.
a. Utility value
b. Present value
c. Salvage value
d. Resale value
238. Occurs when a commodity or service
is supplied by a number of vendors and
there is nothing to prevent additional
vendors entering the market.
a. Free market
b. Perfect competition
c. Open market
d. Law of supply and demand

239. In making economy studies a
minimum required profit on the invested
capital is included as a cost. A method
called as __________.
a. Rate of return
b. Annual cost pattern
c. Present worth pattern
d. Capital cost
240. Annuity is required over 10 years to
equate to a future amount of P 15, 000
with i=5%
a. P 1, 192.57
b. P 1, 912.75
c. P 1, 219.60
d. P 1, 921.65
241. A debt of P 1000 is to be paid off in 5
equal yearly payments, each combining
an amortization installment and interest at
4% on the previously unpaid balance of
the debt. What should be the amount of
each payment?
a. P 220.50
b. P 224.62
c. P 242.61
d. P 222.50
242. P 1000 is deposited in a bank at 7%
interest. What is the value of the money
after 25 years, assuming that nothing was
deposited after the initial deposit?
a. P 5, 247.63
b. P 5, 437.34
c. P 5, 427.43
d. P 5, 720.51
243. What is the interest due on a P 1500
note for 4 years and 3 month, if it bears
12% ordinary simple interest?
a. P 756
b. P 765
c. P 675
d. P 576
244. A P 1000-bond which will mature in
10 years and with a bond rate of 10%
payable annually is to be redeemed at P
1040 at the end of this period. If it is sold
now at P 1,120. Determine the yield at
this price.
a. 4.68 %
b. 6.48 %
c. 8.64 %
d. 8.46 %
245. A company sets aside P 300,000
each year as a fund for expansion. If the
fund earns 9% compounded annually,
determine how long will it take before a
building costing P 3, 000, 000 can be
built?
a. 7.34 years
b. 7.44 years
c. 7.20 years
d. 7.54 years
246. Which is NOT an essential element
of an ordinary annuity?

payments are equal.


at the beginning of each
period.

247. 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
248. A method of depreciation whereby

the amount to recover is spread uniformly
over the estimated life of the asset in
terms of the periods or units of output.
C. Declining balance method
D. SYD method
249. Which of the following depreciation
methods cannot have a salvage value of
zero?
A. Declining balance method
C. Straight line method
D. SYD method
250. A method of depreciation where a
fixed sum of money is regularly deposited
at compound interest in a real or
imaginary fund in order to accumulate an
amount equal to the total depreciation of
an asset at the end of the assets
estimated life.
D. SYD method
251. A price tag of P1200 is specified if
paid within 60 days but offers a 3%
discount for cash in 30 days. Find the rate
of interest.
A. 37.11%
B. 40.21%
C. 38.51%
D. 39.31%
252. It is the practice of almost all bank in
the Philippines that when they grant a
loan, the interest for 1 year is
you applied for a loan with the bank and
the P80000 was approved at an interest
rate of 14% of which P11200 was
deducted and you were given ac check of
P68800. Since you have to pay the
amount of P80000 one year after, what
then will be the effective interest rate?
A. 16.28%
B. 17.30%
C. 38.51%
D. 39.31%
253. Mr. J. Dela Cruz borrowed money
from the bank. He received from the bank
simple interest rate and the corresponding
discount rate or often referred to as the
Bankers Discount.
A. 15.92% ; 13.73%
B. 12.95% ; 17.33%
C.18.28% ; 13.12%
D. 19.25% ; 13.33%
254. A man borrowed from the bank under
a promissory note that he signed in the
amount of P25000.00 for a period of
1year. He received only the amount of
P21,915.00 after the bank collected the
advance interest and an additional
amount of P85.00 for notarial and
inspection fees. What was the rate of
interest that the bank collected in
advance?
A. 13.64%
B. 16.43%
C.18.37%
D. 10.32%
255. Karen was granted a loan of P20,000
by her employer CPM Industrial
Fabricator and Construction Corporation
with an interest at 6% for 180days on the
principal collected in advance. The
note for P20,000 non-interest for 180days.
If discounted at once, find the proceeds in
the note.
A. P18,800
B. P18,000
C. P19,000
D. P18,400
256. P4000 is borrowed for 75days at
16% per annum simple interest. How
much will be due at the end of 75days?
A. P4186.43
B. P4133.33
C. P5124.54
D. P5625.43
257. Mr. Bautista made a money market
placement of P1,000,000 for 30 days at
7.5% per year. If withholding tax is 20%,
what is the net interest that Mr. Bautista
will receive at the end of the month?

A. P3,000
B. P6,000
C. P4,000
D. P5,000
258. A bill for motorboat specifies the cost
as P1,200 due at the end of 100days but
offers a 4% discount for cash in 30days.
What is the highest rate, simple interest at
which the buyer can afford to borrow
money in order to take advantage of the
discount?
A. 18.4%
B. 20.9%
C. 19.6%
D. 21.4%
259. 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 simple interest if he agree to pay
at the end of 120days?
A. 32%
B. 28%
C.40%
D. 25%
260. On March 1, 1996 Mr. Sarmiento
obtains a loan of P1500 from Mr. Avila
and signs a note promising to pay the
principal and accumulated simple interest
at the rate of 5% at the end of 120days.
On May 15, 1996, Mr. Avila discounts the
note at the bank whose discount rate is
6%. What does he receive?
A. P2,201.48
B. P1,513.56
C. P1,123.29
D. P938.20
261. A deposit of P110,000 was made for
31days. The net interest after deducting
20% withholding tax is P890.36. Find the
rate of return annually.
A. 12.25
B. 12.75
C. 11.75
D. 11.95
262. If you borrowed money from your
friend with simple interest of 12%, find the
present worth of P50,000 which is due at
the end of 7months.
A. P46,200
B. P46,729
C. P44,893
D. P45,789
263. A man borrowed P2000 from a bank
and promise to pay the amount for 1year.
He received only the amount of P1,920
after the bank collected an advance
interest of P80. What was the rate of
discount and the rate of interest that the
bank collected in advance?
A. 4% ; 4.17%
B. 4% ; 4.71%
C. 3% ; 3.17%
D. 3% ; 3.71%
264. An engineer promised to pay
P36,000 at the end of 90days. He was
offered a 10% discount if he pays in 30
days. Find the rate of interest.
A. 64.6%
B. 66.6%
C. 65.6%
D. 67.6%
265. A man is required to pay P200 at the
end of 160 days or P190 at the end of 40
days. Determine the rate of interest.
A. 18.4%
B. 15.8%
C. 19.6%
D. 16.4%
266. Compute the discount if P2000 is
discounted for 6 months at 8% simple
interest.
A. P29.67
B. P76.92
C. P67.29
D. P92.76
267. The amount of P12800 in 4years at
5% compounded quarterly is _____.
A. P14,785.34
B. P16,311.26
C. P15,614.59
D. P15,847.33
268. A man borrows money from a bank
which uses a simple discount 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. Determine
the amount of money that he received
from the bank.
A. P1403.68
B. P1102.37
C. P1340.38
D. P1030.28
269. A nominal interest of 3%
compounded continuously is given on the
account. What is the accumulated amount
of P10,000 after 10 years?
A. P13,610.10
B. P13,498.60
C. P13,500.10
D. P13,439.16
270. BY the condition of a will, the sum of
P2000 is left to a girl to be held in trust
fund by her guardian until it amount to
P50000.00. When will the girl receive the
money of the fund is invested at 8%
A. 7.98 years
B. 11.57 years
C. 10.34 years
D. 10.45 years
271. A man expects to receive P25,000 in
8 years. How much is that worth now
considering interest at 8% compounded
quarterly?
A. P13,859.12
B. P13,675.23
C. P13,958.33
D. P13,265.83
272. P500,000 was deposited at an
interest of 6% compounded quarterly.
Compute the compound interest after 4
years and 9 months.
A. P163,475.37
B. P158,270.37
C. P178,362.37
D. P183,327.37
273. If the nominal interest rate is 3%,
how much is P5000 worth in 10 years in a
continuously compounded account?
A. P5750
B. P7500
C. P6750
D. P6350
274. P200,000 was deposited for a period
of 4 years and 6 months and bears on
interest of P85649.25. What is the rate of
interest if it is compounded quarterly?
A. 8%
B. 7%
C. 6%
D. 5%
275. How many years will P100,000 earn
a compound interest of P50,000 if the
interest rate is 9% compounded
quarterly?
A. 3.25 years
B. 5.86 years
C. 4.55 years
D. 2.11 years
276. A certain amount was deposited 5
years and 9 months ago at an interest of
8% compounded quarterly. If the sum now
is P315,379.85, how much was the
amount deposited?
A. P200,000
B. P240,000
C. P180,000
D. P260,000
For Problems 277-279:
When compounded Bi-monthly, P15000
becomes P22,318.30 after 5years.
277. What is the nominal rate of interest?
A. 7%
B. 9%
C. 8%
D. 10%
278. What is the equivalent rate if it is
A. 7.03%
B. 9.03%
C. 8.03%
D. 10.03%
279. What is the effective rate if it is
A. 7.28%
B. 9.28%
C. 8.28%
D. 10.28%
280. How will it take a money to double
annually?
A. 12.2 years
B. 14.2 years
C. 13.2 years
D. 15.2years
281. Compute the effective annual
interest rate which is equivalent to 5%
nominal annual interest compounded

continuously.
A. 5.13%
B. 5.26%
C. 4.94%
D. 4.90%
282. Find the time required for a sum of
money to triple itself at 5% per annum
compounded continuously.
A. 21.97 years
B. 18.23 years
C. 25.34 years
D. 23.36 years
283. 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 will
pay 6% compounded continuously?
A. P24,751.34
B. P28,864.36
C. P36,421.44
D. P30,468.42
284. If the effective annual interest rate is
4%, compute the equivalent nominal
annual interest compounded continuously.
A. 3.92%
B. 3.80%
C. 4.10%
D. 4.09%
285. What is the nominal rate of interest
compounded continuously for 10 years if
the compound amount factor is equal to
1.34986?
A. 3%
B. 5%
C. 4%
D. 6%
286. American Express Corp. charges
1.5% interest per month, compounded
continuously on the unpaid balance
purchases made on this credit card.
Compute the effective rate of interest.
A. 19.72%
B. 21.20%
C. 20.25%
D. 19.90%
287. If the nominal interest is 12%
compounded continuously, compute the
effective annual rate if interest.
A. 12.75%

B. 12.40%
C. 11.26%
D. 11.55%
288. Compute the difference in the future
amount of P500 compounded annually at
nominal rate of 5% and if it is
compounded continuously for 5 years at
the same rate.
A. P3.87
B. P5.48
C. P4.21
D. P6.25
289. If the effective rate is 24%, what
nominal rate of interest is charged for a
continuously compounded loan?
A. 21.51%
B. 23.25%
C. 22.35%
D. 21.90%
290. What is the nominal rate of interest
compounded continuously for 8 years if
the present worth factor is equal to
0.6187835?
A. 4%
B. 6%
C. 5%
D. 7%
291. What is the difference of the amount
3 years from now for a 10% simple
interest and 10% compound interest per
year? (P5000 accumulated)
A. P155
B. same
C. P100
D. P50
292. Find the discount if P2,000 is
discounted for 6 months at 8%
compounded quarterly.
A. P76.92
B. P77.66
C. P80.00
D. P78.42
293. If a sum of money triples in a certain
period of time at a given rate interest,
compute the value of the single payment
present worth factor.
A. 0.333
B. 0.292
C. 3.000
D. 1.962
294. If the single payment amount factor
for a period of 5 years is 1.33822. What is
the nearest value of the interest rate?
A. 8%
B. 5%
D. 7%
D. 6%
295. If the single payment present worth
factor for a period of 8 years is equal to
0.58201, compute the nearest value of the
rate of interest for that period.
A. 6%
B. 5%
C. 7%
D. 8%
296. If money is worth 8% compounded
quarterly, compute the single payment
amount factor for a period of 6 years.
A. 1.60844
B. 1.70241
C. 0.62172
D. 0.53162
left for 8 years, at which time the principal
is withdrawn. The interest has an accrued
left for another 8 years. If the effective
annual interest is 5%, what will be the
withdrawn amount at the end of the
16th year?
A. P507.42
B. P750.42
C. P705.42
D. P425.07
For problems 298 - 300:
Compute the interest for an amount of
P200,000 for a period of 8 years.
298. If it was made at a simple interest
rate of 16% .
A. P274,000
B. P256,000
C. P265,000
D. P247,000
299. If it was made at 16% compounded
bi-monthly.
A. P507,267.28
B. P407,283.01
C. P507,365.96
D. P459,923.44
300. If it was made at 16% compounded

continuously.
A. P422,462.64
B. P524,242.46
C. P507,233.24
D. P519,327.95
301. Find the value of x, (F/P, x, 6) if F/P
compounded quarterly is equal
to 1.612226.
A. 7%
B. 5%
C. 8%
D. 6%
302. Find the value of y, (P/F, 6%, y) if P/F
compounded bi-monthly is equal
to 0.787566.
A. 7 years
B. 5 years
C. 6 years
D. 4 years
303. Find the rate of interest if compound
amount factor compounded bi-monthly for
5 years is equal to 1.487887.
A. 7%
B. 5%
C. 8%
D. 6%
304. Compute the nominal rate for a
period of 6 years for an effective rate
of 8.33% if it is compounded continuously.
A. 7%
B. 5%
C. 8%
D. 6%
305. Compute the equivalent compound
amount factor if it is compounded
continuously.
A. 1.61607
B. 1.24532
C. 1.24282
D. 0.24245
306. Compute the equivalent present
worth factor if it is compounded
continuously.
A. 1.249347
B. 1.243248
C. 1.214359
D. 0.616783
307. A man loan P2000 from the bank.

How long would it take in years for the
amount of the loan and interest to equal
P3280 if it was made at 8% simple
interest.
A. 7 years
B. 5 years
C. 8 years
D. 6 years
How long would it take in years if it was
made at 8% compounded quarterly.
A. 5.25 years
B. 7.25 years
C. 6.25 years
D. 8.25 years
How long would it take in years if it was
made at 8% compounded continuously.
A. 7.18 years
B. 5.18 years
C. 8.18 years
D. 6.18 years
310. An amount of P1000
becomes P1608.44 after 4
years compounded bi-monthly. Find the
nominal rate of interest, the effective rate
of interest, and the equivalent rate of
interest if it is compounded quarterly.
A. 11% ; 12.623% ; 11.42%
B. 12% ; 11.06% ; 12.724%
C. 12% ; 12.616% ; 12.06%
D. 11% ; 11.664% ; 11.93%

311. How long would it take your money
to double itself if it is invested at 6%
simple interest, compounded semiquarterly, and compounded continuously?
A. 12.67 yrs ; 11.2 yrs ; 15.05

yrs
B. 18.67 yrs ; 11.6 yrs ; 11.24

yrs
C. 16.67 yrs ; 11.6 yrs ; 11.55

yrs
D. 17.67 yrs ; 10.2 yrs ; 11.45

yrs
For problems 312 - 314:
An amount of P50,000 was invested for 3
years.
312. Compute its interest at the end of 3

years if it is invested at 10% simple
interest.
A. P16,550.00
B. P15,000.00
C. P17,492.94
D. P14,242.15
313. Compute for its compound interest if
it is invested at 10%
compounded annually.
A. P16,550.00
B. P15,000.00
C. P17,492.94
D. P14,242.15
314. Compute its interest if it is invested
at 10% compounded continuously.
A. P16,550.00
B. P15,000.00
C. P17,492.94
D. P14,242.15
For Problems 315 - 317:
P200,000 was deposited for a period of 4
yrs. And 6 months and bears on interest
of P85,659.25.
315. What is the nominal rate of interest if
it is compounded quarterly?
A. 8.00%
B. 7.00%
C. 8.24%
D. 7.96%
316. What is the actual rate of interest?
A. 8.00%
B. 7.00%
C. 8.24%
D. 7.96%
317. What is the equivalent nominal rate if
it is compounded semi-quarterly?
A. 8.00%
B. 7.00%
C. 8.24%
D. 7.96%
318. What is the value of (F/P, 8%, 6) if it
is compounded semi-quarterly.
A. 0.524273541
B. 1.487886717
C. 0.787566127
D. 1.612226000
319. What is the value of (P/F, 6%, 4) if it
is compounded bi-monthly.

A. 0.524273541
B. 1.487886717
C. 0.787566127
D. 1.612226000
320. What is the single
payment compound amount factor for
8% compounded bi-monthly for 5 years.
A. 0.524273541
B. 1.487886717
C. 0.787566127
D. 1.612226000
If money is invested at a nominal rate of
interest of 8% for a period of 4 years.
321.) What is the effective rate if it is
compounded continuously?
A. 8.33%
B. 9.33%
C. 8.93%
D. 9.93%
322.) What is the value of the compound
amount factor if it is compounded
continuously?
A. 1.377128
B. 1.424231
C. 0.214212
D. 0.122416
323. What is the value of the present
worth factor if it is compounded
continuously?
A. 1. 272441
B. 0.272441
C. 1.726419
D. 0.726149
324. If the single payment amount factor
for a period of 5 years is 1.33822, what is
the nominal rate of interest?
A. 6.00%
B. 7.00%
C. 6.92%
D. 7.92%
325. What is the effective rate of
interest if it is compounded semi-annually
of problem no. 324?
A. 5.00%
B. 7.24%
C. 6.92%
D. 6.09%
326. What is the equivalent nominal

rate if it is compounded quarterly of
problem no. 324?
A. 6.12%
B. 4.24%
C. 5.43%
D. 5.87%
327. 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%
328.) What is the actual interest rate of
problem no. 327?
A. 7.24%
B. 7.92%
C. 8.24%
D. 8.87%
329.) What is the equivalent rate if
problem no. 327 is compounded daily?
A. 7.24%
B. 7.92%
C. 8.24%
D. 8.87%
A businessman loaned P500,000 from a
local bank that charges an interest rate of
12%.
330. How much is he going to pay at the
end of 5 years if it was made at
12% simple interest?
A. P800,000.00
B. P911,059.20
C. P823,243.09
D. P907,009.21
12% compound semi-quarterly?
A. P800,000.00
B. P911,059.20
C. P823,243.09
D. P907,009.21
12% compound continuously?
A. P800,000.00
B. P911,059.20
C. P823,243.09
D. P907,009.21
333. P60,000 was deposited at
6% compounded quarterly, tax free for 9
years and 3 months. How much interest
was earned at the end of the period?
A. P43,214.24
B. P44,086.60
C. P43.242.24
D. P44,215.60
334. P100,000 was placed in a time
deposit which earned 9% compounded
quarterly tax free. After how many years
would it be able to earn a total interest of
P50,000?
A. 4.56 years
B. 3.45 years
C. 4.23 years
D. 3.64 years
335. P200,000 was placed in a time
deposit at x% compounded
quarterly and was free of taxes. After
exactly 5 years, the total interest earned
was P120,000. What is the value of x?
A. 9.5%
B. 6.35%
C. 8.21%
D. 7.12%
A. 12.35% compounded
annually
B. 12.2% compounded
quarterly
C. 11.9% compounded semiannually
D. 11.6% compounded
monthly
337. It takes 20.15 years to quadruple
your money if it is invested at x%
compounded semi-annually. Find the
value of x.
A. 8%
B. 7%
C. 6%
D. 5%
338. It takes 13.87 years to treble the
money at the rate of x% compounded
quarterly. Compute the value of x.
A. 5%
B. 7%
C. 6%
D. 8%
339. Money was invested at x
% compounded quarterly. If it takes the
money into quadruple in 17.5 years, find
the value of x.
A. 8%
B. 7%
C. 6%
D. 5%
340. Fifteen years ago P1,000.00 was
deposited in a bank account, and today it
is worth P2.370.00. The bank pays
interest semi-annually. What was the
interest rate paid on this account?
A. 4.9%
B. 5.0%
C. 5.8%
D. 3.8%
bank at a rate of 18% per year. Compare
how much money you will save or lose on
the transaction.
A. pay P155 more if you

borrowed from the bank
B. save P55 by borrowing from

your friend
C. pay P85 more if you

borrowed from the bank
D. save P95 by borrowing from

your friend
342. Find the present worth of a future
payment of P1000,000 to be made in 10
years with an interest of 12%
A. P30,444.44
B. P30,655.68
C. P33,000.00
D. P30,546.01
343. An initial savings deposit of P80,000
in a certain bank earns 6% interest per
annum compounded monthly. If the
earnings from the deposit are subject to a
20% tax, what would the net value of the
deposit be after three quarters?
A. P95,324.95
B. P68743.24
C. P82938.28
D. P56244.75
344. The effective rate of interest of 14%
compounded semi-annually is:
A. 14.49%
B. 14.94%
C. 14.36%
D. 14.88%
345. The amount of P50,000 was
deposited in a bank earning an interest of
7.5% per annum. Determine the total
amount at the end of 5 years, if
the principal and interest were not
withdrawn during the period.
A. P71,781.47
B. P70,374.90
C. P72,475.23
D. P78,536.34
346. What is the effective
rate corresponding to 18% compounded
daily? Take 1 year is equal to 360 days.
A. 18.35%
B. 18.10%
C. 19.39%
D. 19.72%
347. If P1,000 becomes P1,126.49 after 4
years when invested at a certain nominal
rate of interest compounded semiannually, determine the nominal rate and
the corresponding effective rate.
A. 3.00% and 3.02%
B. 2.30% and 2.76%
C. 4.29% and 4.32%
D. 3.97% and 3.95%

348. Convert 12% semi-annually
to compounded quarterly.
A. 19.23%
B. 14.67%
C. 23.56%
D. 11.83%
349. What is the corresponding effective
interest rate of 18% compounded semiquarterly?
A. 19.25%
B. 18.46%
C. 19.48%
D. 18.95%
350.) If P5000 shall accumulate for 10

years at 8% compounded quarterly, find
the compounded interest at the end of
10 years.
A. P6,005.30
B. P6,040.20
C. P6,000.00
D. P6,010.20
351. A couple borrowed P4,000 from a
lending company for 6 years at 12%. At
the end of 6 years, it renews the loan for
the amount due plus P4,000 more for 3
years at 12%. What is thelump sum due?
A. P14,842.40
B. P12,316.40
C. P16,712.03
D. P15,382.60
352. How long (in years) will it take the
money to quadruple if it earns
7% compounded semi-annually?
A. 26.30 years
B. 33.15 years
C. 40.30 years
D. 20.15 years
153. P200,000 was deposited on Jan.
1,1988 at an interest rate of
24% compounded semi-annually. How
much would the sum be on Jan. 1, 1993?
A. P421,170
B. P401,170
C. P521,170
D. P621,170
354. If P500,000 is deposited at a rate of
11.25% compounded monthly, determine
the compounded interest after 7 years
and 9 months.
A. P690,849
B. P680,686
C. P670,258
D. P660,592
355.) P200,000 was deposited at an
interest rate of 24% compounded semiannually. After how many years will the
sum be P621,170?
A. 4 years
B. 5 years
C. 3 years
D. 6 years
356. A bank is advertising 9.5% accounts

that yields 9.84% annually. How often is
the interest compounded?
A. monthly
B. quarterly
C. bi-monthly
D. daily
357. A marketing company established a
program to replace the cars of its sales
representatives at the end of every 5
years. If the present price of the approved
type of car is P520,000.00 with a resale
value at the end of 5 years of 60% its
present value, how much money must the
company accumulate for 5 years
if inflation annually is 10%. Release
value will also appreciate at 10% yearly.
A. P120,289.51
B. P110,297.27
C. P129,382.38
D. P122,265.69
358. In year zero, you invest P10,000.00
in a 15% security for 5 years. During that
How much, in terms of year zero will be in
the account atmaturity?
A. P15,386.00
B. P13,382.00
C. P15,030.00
D. P16,653.00
359. A machine has been purchased and
installed at a total cost of P18,000.00. The
machine will be 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 an exact duplicate. The
company plans to establish a reserve fund
to accumulate the capital needed to
replace the machine. If an average
annual rate of inflation of 3% is
anticipated, how much capital must be
accumulated?
A. P15,030.00
B. P12,382.00
C. P18,548.39
D. P15,386.00
360. If the inflation rate is 6%, cost of
money is 10%, what interest rate will take
care of inflation and the cost of money?
A. 16.6%
B. 17.7%
C. 15.5%
D. 14.4%
361. A man bought a government bond
which cost P1000 and will pay P50
interest each year for 20 years. The bond
will mature at the end of 20 years and he
will receive the original P1000. If there
is 2% annual inflation during this period,
what rate of return will the investor receive
after considering the effect of inflation?
A. 2.94%
B. 4.25%
C. 3.16%
D. 5.16%
362.) The inflated present worth of P2000
in two years is equal to P1471.07. What is
the rate of inflation if the interest rate is
equal to 10%?
A. 6%
B. 7%
C. 5%
D. 4%
363. 12% rate of interest can take care of
the cost of money and inflation. If
the nominal rate of interest is 6%, what
is the rate of inflation?
A. 6.62%
B. 7.67%
C. 5.66%
D. 4.64%
364. An engineer bought an equipment for
P500,000. Other expenses including
installations amounted to P30,000. At the
end of its estimated useful life of 10 years,
the salvage value will be 10% of the first
cost. Using straight line method of
depreciation, what is the book value after
5 years?
A. P291,500
B. P242,241
C. P282,242
D. P214,242
365. A small machine costing P80,000
has a salvage value of x at the end of its
life of 5 years. The book value at the end
of the 4th year is P22,400. What is the
value of x using the straight line method
depreciation?
A. P6000
B. P8000
C. P7000
D. P9000
366. A machine has a salvage value of
P12,000 at the end of its useful life of 6
years. The book value at the end of 5
years is P30,833.33. Using a straight line
method of depreciation,what is the first
cost of the machine?
A. P125,500
B. P125,000
C. P135,500
D. P135,000
367. A manufacturing plant was built at a
cost of P5M and is estimated to have a
life of 20 years with a salvage value of
P1M. A certain equipment worth P570,000
was installed at a cost of P80,000 is
expected to operate economically for 15
years with a salvage value of P50,000.
Determine the book value of the plant
and equipment after 10 years, use straight
line depreciation method.
A. P3,250,000
B. P4,250,000
C. P3,750,000
D. P4,500,000
368. A printing equipment costs P73,500
has a life expectancy of 8 years and has a
salvage value of P3,500 at the end of its
life. The book value at the end of x years
is equal to P38,500. Using straight line
method of depreciation, solve for the
value of x.
A. 5 years
B. 6 years
C. 4 years
D. 3 years
369. The cost of the printing equipment is
P500,000 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
P242,000 and the life of the equipment is
assumed to be 5 years, determine
the salvage value of this equipment at
the end of 5 years.
A. P50,000
B. P53,000
C. P60,000
D. P64,000

P500,000. He spent an additional amount
of P30,000 for installation and other
expenses. The salvage value is 10% of
the first cost. If the book value at the end
of 5 years will be P291,500 using straight
line method of depreciation, compute
the useful life of the equipment in years.
A. 10 years
B. 6 years
C. 8 years
D. 15 years
371. The cost of equipment is P500,000
and the cost of installation is P30,000. If
the salvage value is 10% of the cost of
equipment at the end of 5 years,
determine the book value at the end of
the fourth year. Use straight line method.
A. P155,000
B. P146,000
C. P140,000
D. P132,600
For Problems 172-174:
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 total depreciation after 3 years.
372. Using Straight Line Method
A. P800,000
B. P900,000
C. P600,000
D. P700,000
373. Using Sum of Years Digit Method
A. P1,150,000
B. P1,300,000
C. P1,200,000
D. P1,350,600
374. Using Constant Percentage Method
A. P1,355,024.24
B. P1,246,422.53
C. P1,185,769.76
D. P1,432,624.84
375. An asset is purchased for P9,000.00.
after which it will be sold for P1,000.00.
years using straight line method.
A. P2,500
B. P3,000
C. P2,400

D. P2,000
376. The purchase of a motor for P6000
and a generator for P4000 will allow the
company to produce its own energy. The
configuration can be assembled for P500.
The service will operate for 1600 hours
per year for 10 years. The maintenance
cost is P300 per year, and cost to operate
is P0.85 per hour for fuel and related cost.
Using straight line depreciation, what is
the annual cost for the operation?
There is a P400 salvage value for the
system at the end of 10 year.
A. P2,710
B. P2,630
C. P2,480
D. P2,670
377. A machine has an initial cost of
P50,00.00 and a salvage value of
P10,000.00 after 10 years. What is
the straight line method depreciation
rate as a percentage of the initial cost?
A. 10%
B. 12%
C. 8%
D. 9%
P10,000.00 after 10 years. What is
the book value after 5 years using
straight line method depreciation rate?
A. P35,000
B. P15,500
C. P25,000
D. P30,000
379. A machine has a first of P80,000 and
a salvage of P2,000 at the end of its life of
10 years. Find the book value at the end
of the 6th year using straight line method
of depreciation.
A. P33,200
B. P34,300
C. P35,400
D. P32,900
380. An asset is purchased for
P90,000.00. Its estimated life is 10 years
Find the book value during the first year if
Sum of the Years Digits(SYD)
depreciation is used.
A. P7,545.45
B. P5,245.92
C. P2,980.24
D. P6,259.98
381. A telephone company purchased a
microwave radio equipment for P6M.
Freight and installation charges amounted
to 3% of the purchased price. If the
equipment shall be depreciated over a
period of 8 years with a salvage value of
5%, determine the depreciation charge
during the 5th year using the Sum of Year
Digit Method.
A. P756,632.78
B. P652,333.33
C. P957,902.56
D. P845, 935.76
382. A consortium of international
communications companies contracted for
the purchase and installation of a fiber
optic cable linking two major Asian cities
at a total cost of P960M. This amount
includes freight and installation charges at
10% of the above total contract price. If
the cable depreciated over a period of 15
years with zero salvage value, what is
thedepreciation charge during the
8th year using the sum of year digits
method?
A. P64 M
B. P80 M
C. P23 M
D. P76 M
383. A machine cost P7,350 has a life of 8
years and has a salvage value of P350 at
the end of 8 years. Determine its book
value at the end of 4 years using sum
years digit method.
A. P3,476.90
B. P6,543.21
C. P2,294.44
D. P5,455.01
384. A certain equipment costs P7,000
has an economic life of n years and a
salvage value P350 at the end of n years.
If the book value at the end of 4 years is
equal to P2197.22, compute for
the economic life of the
equipment using the sum of years digit
method.
A. 10 years
B. 8 years
C. 16 years
D. 11 years
385. A company purchased an asset for
P10000 and plans to keep it for 20 years.
If the salvage value is zero at the end of
the 20th year, what is the depreciation in
the third year? Use sum of years digit
method.
A. P1000
B. P938
C. P857
D. P747
386. An equipment costs P7000 and has
a life of 8 years and salvage value of x
after 8 years. If the book 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.
A. P594
B. P350
C. P430
D. P290
387. ABC Corporation makes it policy that
for every new equipment purchased, the
annual depreciation should not exceed
20% of the first cost at any time without
salvage value. Determine the length of
service if the depreciation used is the
SYD Method.
A. 9 years
B. 12 years
C. 10 years
D. 19 years
388. A machine having a certain first cost
has a life of 10 years and a salvage value
of 6.633% of the first cost at the end of 10
years. If it has a book value of P58,914 at
the end of the 6thyear, how much is the
first cost of the machine if the constant
percentage of declining value is used in
the computation for its depreciation.
(Mathesons Method)
A. P600,000
B. P100,000
C. P300,000
D. P900,000
389. A machine costing P720,000 is
estimated to have a life of 10 years. If the
annual rate of depreciation is 25%,
determine the total depreciation using a
constant percentage of the declining

balance method.
A. P679,454.27
B. P532,825.73
C. P432,725.45
D. P764,243.33
390. An earth moving equipment that cost
P90,000 will have an estimated salvage
value of P18,000 at the end of 8 years.
Using double-declining balance method,
compute the book value and the total
depreciation at the end of the 5th year.
A. P21,357.42 ; P68,642.58
B. P24,362.48 ; P65,637.52
C. P15,830.34 ; P74,169.66
D. P19,442.78 ; P70,557.22
391. A certain office equipment has a first
cost of P20,000 and has a salvage value
of P1,000 at the end of 10 years.
Determine the depreciation at the end of
the 6th year using Sinking fund
method at 3% interest.
A. P10,720
B. P11,680
C. P12,420
D. P9,840
392. An equipment which cost P200,000
has a useful life of 8 years with a salvage
value of P25,000 at the end of its useful
life. If the depreciation at the first year is
P21,875, what method is used in the
calculation of depreciation?
A. Straight Line
B. Declining Balance
C. Sinking Fund
D. Sum of Years Digit

393. An equipment costs P8,000 has an
economic life of 8 years and salvage
value of P400 at the end of 8 years. The
first year depreciation amounts to
P1,688.89. What method is used in the
calculation of the depreciation?
A. Straight Line
C. Sinking Fund

394. The original cost of a certain
machine is P150,000 and has an
economic life of 8 years with a salvage
value of P9,000 at that time. If the
depreciation of the first year is equal to

P44,475, what method is used in the
calculation of the depreciation?
A. Straight Line
C. Sinking Fund

395. A machine has a first cost of
P140,000 and a life of 8 years with a
salvage value of P10,000 at the end of its
useful life. If the depreciation at the first
year amounts to P35,000, what method is
used in the calculation of depreciation?
A. Double Declining Balance
B. Straight Line
C. Declining Balance

396. A hydraulic machine cost P180,000
and has a salvage value of P15,000 at the
end of its useful life which is 12 years. If
the depreciation at the first year is
P9,780.71, what method is used in
computing the depreciation. Assume
money is worth 6% annually.
A. Straight Line
C. Sinking Fund

397. An equipment costs P480,000 and
has a salvage value of 10% of its cost at
the end of its economic life of 35,000
operating hours. In the first year, it was
used for 4,000 hours. Determine its book
value at the end of the first year.
A. P430,629.00
B. P418,360.00
C. P380,420.00
D. P376,420.00
398. An equipment costs P480,000 and
has a salvage value of 10% of its cost at
the end of its economic life of 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 was used for 15,000 hours, find
the depreciation at the second year.
A. P180,000
B. P190,000
C. P160,000
D. P150,000
399. A certain machine cost P40,000 and

has a life of 4 years and a salvage value
of P5000. The production output of this
machine in units per year is 1000 units for
the first year, 2000 units for the second
year, 3000 units for the third year, and
4000 units for the fourth year. If the units
produced are in uniform quality, what is
the depreciation charge at the end of the
fourth year.
A. P14,000
B. P15,000
C. P13,000
D. P16,000
400. A lathe machine costs P300,000
brand new with a salvage value of x
pesos. The machine is expected to last for
28500 hours in a period of 5 years. In the
first year of service it was used for 8000
hours. If the book value at the end of the
first year is P220,000, compute for
the salvage value x in pesos.
A. P15,000
B. P12,000
C. P18,000
D. P20,000
401. It is defined to be the capacity of a
commodity to satisfy human want
A. Necessity
B. Utility
C. Luxuries
D. Discount
402. It is the stock that has prior to
dividends. It usually does not bring voting
right to the owners and the dividend is
fixed and cannot be higher than the
specified amount.
A. Common stock
B. Voting stock
C. Pretend stock
D. Non par value stock

403. It is an amount which a willing buyer
will pay to a willing seller for the property
where each has equal advantage and is
under no compulsion to buy or sell.
A. Book value
B. Market value
C. Use value
D. Fair value
404. ____ is the loss of value of the

equipment with use over a period of time.
It could mean a difference in value
between a new asset and the use asset
currently in a service.
A. Loss
B. Depreciation
C. Extracted
D. Gain
405. An economic condition in which there
are so few suppliers of a particular
product that one suppliers actions
significantly affect prices and supply.
A. Oligopoly
B. Monopsony
C. Monopoly
D. Perfect competition
406. A market whereby there is only one
buyer of an item for when there are no
goods substitute.
A. Monosony
B. Monopoly
C. Oligopoly
D. Oligopsony
407. It is the worth of a property as
recorded in the book of an enterprise.
A. Salvage value
B. Price
C. Book value
D. Scrap value
408. Reduction in the level of nation
income and output usually accompanied
by a fall in the general price level.
A. Devaluation
B. Deflation
C. Inflation
D. Depreciation
within industry forming a perfect collusion
purposely formed to increase profit and
block new comers from the industry.
A. Cartel
B. Monopoly
C. Corporation
D. Competitors
410. A market situation where there is
only one seller with many buyer.
A. Monopoly
B. Monophony
C. Oligopoly
411. A market situation where there is one
seller and buyer.
A. Bilateral monopoly
B. Monopoly
C. Oligopoly
D. Bilateral Monopoly
412. Reduction in the level of national
by a fall in the general price level.
A. Deflation
B. Inflation
C. Devaluation
D. Depreciation
413. A series of equal payments made at
A. Annuity
B. Amortization
C. Depreciation
D. Bonds
414. The money paid for the use of
borrowed capital.
A. Interest
B. Amortization
C. Annuity
D. Bonds
415. The place where buyers and sellers
come together.
A. Maker
B. Store
C. Bargain center
D. Port
416. The value of the stock as stated on
the stocks certificate
A. Stock value
B. Par value
C. Interest
D. Maturity value
417. A market situation in which two
competing buyers exert controlling
influence over many sellers.
A. Bilateral monopoly
B. Oligopoly
C. Duopsony
D. Duopoly
418. A market situation in which two
powerful groups or organizations
dominate commerce in one business

market or commodity.
A. Oligopoly
B. Duopoly
C. Duopsony
D. duopoly
419. The type of annuity where the first
payment is made after several periods,
after the beginning of the payment.
A. Perpetuity
B. Ordinary annuity
C. Annuity due
D. Deferred annuity
420. The condition in which the total
income equals the total operating
expenses.
A. Tally
B. Par value
C. Check and balance
D. Break even
421. The amount which has been spent or
capital invested which for some reasons
cannot be retrieved.
A. Sunk cost
B. Fixed costs
C. Depletion cost
D. Construction cost
422. An obligation with no condition attach
is called
A. Personal
B. Gratuitous
C. Concealed
D. Private
423. The sum of all the costs necessary to
prepare a construction project for
operation.
A. Operation costs
B. Construction cost
C. Depletion cost
D. Production cost
424. The amount received from the sale
of an addition unit of a product.
A. Marginal cost
B. Marginal revenue
C. Extra profit
D. Prime cost
425. The amount that the property would
give if sold for junk.
A. Junk value
B. Salvage value
C. Scrap value
D. Book value
426. The worth of the property which is
equal to the original cost less the amount
which has been charged to depreciation.
A. Scrap value
B. Salvage value
C. Book value
D. Market value
427. The sum of the direct labor cost
incurred in the factory and the direct
material cost of all materials that go into
production is called
A. Net cost
B. Maintenance cost
C. Prime cost
D. Operating cost
value and the worth of money at some
time in the future is called
A. Market value
B. Net value
C. Discount
D. Interest
429. The addition cost of producing one
more unit is
A. Prime cost
B. Marginal cost
C. Differential cost
D. Sunk cost
430. A written contract by a debtor to pay
final redemption value on an indicated
date or maturity date and pay a certain
sum periodically.
A. Annuity
B. Bond
C. Amortization
D. Collateral
431. Estimated value of the property at
the useful life.
A. Market value
B. Fair value
C. Salvage value
D. Book value
432. Determination of the actual quantity
of the materials on hand as of a given
date.
A. Physical inventory

B. Counting principle
C. Stock assessment
D. Periodic material update

433. This consists of a cash and account
receivable during the next period or any
other material which will be sold.
A. Fixed assets
B. Deferred charges
C. Current asset
D. Liability
434. A wrong act that causes injury to a
person or property and for which allows a
claim by the injured party to recover
damages.
A. Fraud
B. Tort
C. Libel
D. Scam
435. A series of uniform payment over an
infinite period of time
A. Depletion
B. Capitalized cost
C. Perpetuity
D. Inflation
436. These are products or services that
are required to support human life and
activities that will be purchased in
somewhat the same quantity event
though the price varies considerably.
A. Commodities
B. Necessities
C. Demands
D. Luxury
437. The quantity of a certain commodity
that is offered for sale at a certain price at
a given place and time.
A. Utility
B. Supply
C. Stocks
D. Goods
438. It is sometimes called the second
hand value
A. Scrap value
B. Salvage value
C. Book value
D. Par value
439. Decreases in the value of a physical
property due to the passage of time.
A. Deflation
B. Depletion
C. Declination
D. Depreciation
individuals for the purpose of engaging
business for profit.
A. Single proprietorship
B. Party
C. Corporation
D. Partnership
441. The simplest form of business
organization where in the business is own
entirely by one person.
A. Partnership
B. Proprietorship
C. Corporation
D. Joint venture
442. Parties whose consent or signature
in a contract is not considered intelligent.
A. Dummy person
B. Minors
C. Demented persons
D. Convict
443. It is defined as the capacity of a
commodity to satisfy human want.
A. Satisfaction
B. Luxury
C. Necessity
D. Utility
444. This occurs in a situation where a
commodity or service is supplied by a
number of vendors and there is nothing to
prevent additional vendors entering the
market.
B. Monophony
C. Monopoly
D. Cartel
are desired by human and will be
purchased if money is available after the
required necessities have been obtained.
A. Commodities
B. Necessities
C. Luxuries
D. Supplies
446. Grand total of the assets and
operational capability of a corporation.
A. Authorized capital
B. Paid off capital
C. Subscribed capital
D. Investment
447. It is where the original record of a
business transaction is recorded.
A. Ledger
B. Spreadsheet
C. Journal
D. Logbook
448. The length of time which the property
may be operated at a profit.
A. Life span
B. Economic life
C. Operating life
D. Profitable life
449. The right and privilege granted to an
individual or corporation to do business in
a certain region.
A. Permit
B. Royalty
C. License
D. Franchise
450. The worth of an asset as shown in
the accounting records of an enterprise.
A. Fair value
B. Par value
C. Market value
D. Book value
451. A bookstore purchased a best-selling
book at P200.00 per copy. At what price
should this book be sold so that by giving
a 20% discount, the profit is 30%.
A. P200.00
B. P300.00
C. P400.00
D. P500.00
452. A businessman wishes to earn 7%
on his capital after payment of taxes. If
the income from an available investment
will be taxed at an average of 42%, what
minimum rate of return, before payment of
taxes, must the investment offer to be
justified?
A. 13.02%
B. 12.07%
C. 10.89%
D. 11.08%

the demand?
A. 1 hour
B. 1 hour and 10 minutes
C. 1 hour and 15 minutes
D. 1 hour and 30 minutes

454. Froyd Corporations gross margin is
45% of sales. Operating expenses such
as sales and administration are 15% of
sales. Froyd Corporation is in 40% tax
bracket. What percent of sales is their
profit after taxes?
A. 21%
B. 20%
C. 19%
D. 18%
455. In determining the cost involved in
fabricating sub-assembly B within a
company, the following data have been
gathered:
Direct material - P0.30 per unit
Direct labor - P0.50 per unit
Testing set-up - P300.00 per set-up
It is decided to subcontract the
manufacturing of assembly B to an
outside company. For an order of 100
units, what is the cost per unit that is
acceptable to the company?
A. P3.80
B. P4.00
C. P4.10
D. P4.20
456. By selling balut at P5 per dozen, a
vendor gains 20%. The cost of the eggs
rises by 12.5%. If he sells at the same
price as before, find his new gain in %.
A. 6.89%
B. 6.67%
C. 6.58%
D. 6.12%
457. An equipment installation job in the
completion stage can be completed in 50
days of 8 hour/day work, with 50 men
working. With the contract expiring in 40
days, the mechanical engineer contractor
decided to add 15 men on the job,

overtime not being permitted.
If the liquidated damages is P5,000 per
day of delay, and the men are paid P150
per day, how much money would he save
with the additional workers?
A. P43,450
B. P43,750
C. P44,250
D. P44,750
458. In a certain department store, the
monthly salary of a saleslady is partly
constant and partly varies as the value of
her sales for the month. When the value
of her sales for the month is P10,000.00,
her salary for the month is P900.00. When
her monthly sales go up to P12,000.00,
her monthly salary goes up to P1,000.00.
What must be the value of her sales so
that her salary for the month will be
P2,000.00?
A. P30,000
B. P31,000
C. P32,000
D. P33,000
459. Jojo bought a second-hand Betamax
VCR and then sold it to Rudy at a profit of
40%. Rudy then sold the VCR to Noel at a
profit of 20%. If Noel paid P2,856 more
than it costs Jojo, how much did Jojo pay
for the unit?
A. P4,100
B. P3,900
C. P4,000
D. P4,200
460. 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 was
given to the customer?
A. 37.5%
B. 37.9%
C. 38.2%
D. 38.5%
461. 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
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 everyday thereafter. If the total
penalty was P60,750.00, how many days
was the completion of the contract
delayed?
A. 26 days
B. 27 days
C. 28 days
D. 29 days
462. The quarrying cost of marble and
granite blocks plus delivery cost to the
processing plant each is P2,400.00 per
cubic meter. Processing cost of marble
into tile is P200.00 per square meter and
that of the granite into tiles also is
P600.00 per square meter.
If marble has a net yield of 40 square
meters of tile per cubic meter of block and
sells P400 per square meter, and granite
gives a net yield of 50 square meters of
tiles per cubic meter of block and sells at
P1000 per square meter. Considering all
other costs to be the same, the granite is
more profitable than the marble by how
much?
A. P12,000 per cubic meter
B. P13,000 per cubic meter
C. P14,000 per cubic meter
D. P15,000 per cubic meter

463. A man would like to invest P50,000 in
government bonds and stocks that will
give an overall annual return of about 5%.
The money to be invested in government
bonds will give an annual return of 4.5%
and the stocks of about 6%. The
investments are in units of P100.00 each.
If he desires to keep his stock investment
to minimum in order to reduce his risk,
determine how many stocks should be
purchased.
A. 165
B. 166
C. 167
D. 168
464. A 220 V 2 hp motor has an efficiency
of 80%. If power costs P3.00 per kw-hr for
the first 50 kw-hr, 2.90 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 reached. How much does it cost
to run this motor continuously for 7 days?
A. P800
Average hauling distance
B. P820
Monthly rental
C. P840
Installing and dismantling of machine
D. P860
At Site A, it would be necessary to hire 2
465. An 8-meter concrete road pavement
flagmen at P150 per working day. The job
500 meters long is desired to be
can be completed in 32 weeks working 6
constructed over a well-compacted gravel
days a week. The project requires 16,670
road, together with the necessary
cubic meter of asphalt mix per kilometre
concrete curbs and gutters on both sides.
of road. If the asphalt mix is to be hauled
In order to put the subgrade on an even
by a contractor at P42 per cubic meter per
level grade, a 500 cubic meters of sand
km of haul. How much is site B more
filling is necessary, over which the 10 inch
expensive than site A?
concrete pavement will be placed?
A. P949,645
Assume the following data:
B. P962,101
A. Sand fill, including rolling and watering
C. P956,807
= P100 per cubic meter
D. P974,090
B. Concrete pavement, 10 in thick (labor
and materials) including curing = P220
468. A fixed capital investment of
per sq. Meter
P10,000,000 is required for a proposed
C. Curbs and gutters = P12 per linear
manufacturing plant and an estimated
meter
working capital of P2,000,000. Annual
How much will the project cost allowing
depreciation is estimated to be 10% of the
15% for contingency?
fixed capital investment. Determine the
rate of return on the total investment if the
A. P1,207,000
annual profit is P2,500,000.
B. P1,207,500
A. 28.33%
C. P1,208,000
B. 29.34%
D. P1,208,500
C. 30.12%
466. An electric utility purchases
D. 30.78%
2,300,000 kw-hr per month of electric
energy from National Power Corporation
469. A call to bid was advertised in the
at P2.00 per kw-hr and sells all this to
Philippine Daily Inquirer for the
consumers after deducting distribution
construction of a transmission line from a
losses of 20%. At what average rate per
mini-hydroelectric power plant to the
kw-hr should this energy be sold to break
substation which is 5.035 kilometers
even if the following are other monthly
away. The tanalized timber electrical
expenses in its operation:
posts must be placed at an interval of 50
Taxes
2.5 % of grossm.revenue
The electrical posts must be 30 feet
Salaries
P750,000
long, 8 inches in diameter at the tip and
Depreciation
P2,250,000 12 inches in diameter at the butt. The
Interest
P700,000
power house is 15 m from the first electric
Maintenance
P300,000
post and the substation is 20 m from the
Miscellaneous
P200,000
last electric post. Compute the estimated
cost for the project using the following
A. P4.90
data:
B. P5.20
Cost of one tanalized timber post 30 feet
C. P5.90
long is P5,000 including delivery to the
D. P6.30
site. Labourer at P180 per day and 5
467. An engineer bidding on the
laborers can dig and erect 3 posts per
asphalting of 7 km stretch of road is
day. Electrician at P250 per day and 4
confronted with a problem of choosing
electricians can strung wires complete
between two possible sites on which to
150 meters per day. Electric wire cost
set-up the asphalt-mixing machine.
P4.00 per meter. Use only 5 laborers and
4 electricians for the project and is

supervised by a foreman which is paid at
P400 per day. Contingency is 10% and
profit is 25%.
A. P745,890.23
B. P817,692.00
C. P789,120.80
D. P829,592.50
470. Upon the retirement after 44 years in
government service, Mrs. Salud Araoarao
was able to get a retirement lump sum of
P2,300,000. As a hedge against inflation,
she decided to use a part of it invested in
real state at Pagadian City and the
remainder were invested as follows:
A. 30% in T-bills earning 12% interest
B. 35% in money market placement
earning 14%
C. 35% in blue chip stock earning 13%
If her annual earnings from the T-bills,
money market and stock is P50,000, How
much did she invests in real estate?
A. P2,091,639.12
B. P1,916,858.24
C. P1,856,120.53
D. P1,790,274.78
471. The monthly demand for ice cans
being manufactured by Mr. Alarde is 3200
pieces. With a manual operated guillotine,
the unit cuffing cost is P25.00. An
electrically operated hydraulic guillotine
was 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 able to recover the cost of the machine
if he decides to buy now?
A. 10 months
B. 11 months
C. 12 months
D. 13 months
472. 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:
Processing Method
Cost per ton
A
P5,500
B
P2,500
C
P400
If gold can be sold at P4,000 per ounce,

which method of processing yield the
biggest return?
A. Processing method A
B. Processing method B
C. Processing method C
D. Either of the processing

methods B or C
473. JRT Motors Inc. has been shipping
its Suzuki engines in containers to avoid
the necessary crating of the engines. JRT
Motors Inc. will pay freight on container
load of 40 tons, regardless of whether or
not the container is completely filled with
engines. Record shows that due to engine
size, JRT Motors Inc. has shipped only 30
tons per container. Freight of container
cost P3.00 per kilograms.
If the engines are crated so that they can
be shipped at the rate of P3.50 per
hundred kilograms with the freight bill
computed only on the actual weight
shipped. The cost of crating would be P50
per engine and would increase the
shipping weight from 1500 kg to 1520 kg
per engine. How much more economical
shipping the engine in crates than in
containers?
A. P670 per engine
B. P630 per engine
C. P650 per engine
D. P610 per engine

474. A paint manufacturing company uses
a sand mill for fine grinding of paint with
an output of 100 liters per hour using
glass beads as grinding media. Media
load in the mill is 25 kg costing P200.00
per kg and is fully replenished in 2 months
time at 8 hours per day operation, 25 days
a month. A ceramic grinding media is
offered to this paint company, costing
P400 per kg and 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
media?
A. P436,900
B. P462,000
C. P473,000

D. P498,200
475. If P1000 accumulates to P1500
when invested at a simple interest for
three years, what is the rate of interest?
A. 14.12%
B. 15.89%
C. 16.67%
D. 16.97%
476. You loan from a loan firm an amount
of P100,000 with a rate of simple interest
of 20% but the interest was deducted from
the loan at the time the money was
borrowed. If at the end of one year, you
have to pay the full amount of P100,000,
what is the actual rate of interest?
A. 23.5%
B. 24.7%
C. 25.0%
D. 25.8%
477. A loan of P5,000 is made for a period
of 15 months, at a simple interest rate of
15%, what future amount is due at the
end of the loan period?
A. P5,937.50
B. P5,873.20
C. P5,712.40
D. P5,690.12
478. If you borrowed money from your
friend with simple interest at 12%, find the
present worth of P50,000, which is due at
the end of 7 months.
A. P46,728.97
B. P47,098.12
C. P47,890.12
D. P48,090.21
479. Mr. J. Reyes borrowed money from
the bank. He received from the bank
P1,842 and promised to repay P2,000 at
the end of 10 months. Determine the rate
of simple interest.
A. 12.19%
B. 12.03%
C. 11.54%
D. 10.29%
480. If you borrowed P10,000 from a bank
with 18% interest per annum, what is the
total amount to be repaid at the end of
one year?
A. P10,900
B. P11,200
C. P11,800
D. P12,000
481. A price tag of P1,200 is payable in 60
days but if paid within 30 days it will have
a 3% discount. Find the rate of interest.
A. 35.45%
B. 35.89%
C. 36.18%
D. 37.11%
482. A man borrowed P2,000 from a bank
and promised to pay the amount for one
year. He received only the amount of
P1,920 after the bank collected an
advance interest of P80.00. What was the
rate of discount?
A. 3.67%
B. 4.00%
C. 4.15%
D. 4.25%
483. A man borrowed P2,000 from a bank
and promised to pay the amount for one
year. He received only the amount of
P1,920 after the bank collected an
advance interest of P80.00. What was the
rate of interest that the bank collected in
advance?
A. 4.00%
B. 4.07%
C. 4.17%
D. 4.25%
484. What will be the future worth of
money after 12 months if the sum of
P25,000 is invested today at simple
interest rate of 1% per year?
A. P25,168
B. P25,175
C. P25,189
D. P25,250
485. What will be the future worth of
money after 12 months if the sum of
P25,000 is invested today at simple
interest rate of 1% per month?
A. P28,000
B. P28,165
C. P28,289
D. P28,250
486. 480 It is the practice of almost all
banks in the Philippines that when they
grant a loan, the interest for one year is

you applied for a loan with a bank and the
P80,000 was approved at an interest rate
of 14% of which P11,200 was deducted
and you were given a check of P68,800.
Since you have to pay the amount of
P80,000 one year after, what then will be
the effective interest rate?
A. 16.02%
B. 16.28%
C. 16.32%
D. 16.47%
487. A deposit of P110,000 was made for
31 days. The net interest after deducting
20% withholding tax is P890.36. Find the
rate of return annually.
A. 11.50%
B. 11.75%
C. 11.95%
D. 12.32%
488. P5,000 is borrowed for 75 days at
much will be due at the end of 75 days?
A. P5,066.67
B. P5,133.33
C. P5,050.00
D. P5,166.67
489. A businessman wishes to earn 7%
on his capital after payment of taxes. If
the income from an available investment
will be taxed at an average rate of 42%,
what minimum rate of return, before
payment of taxes, must the investment
offer to be justified?
A. 12.07%
B. 12.34%
C. 12.67%
D. 12.87%
490. A man borrowed P20,000 from a
local commercial bank which has a simple
interest of 16% but the interest is to be
deducted from the loan at the time that
the money was borrowed and the loan is
payable at the end of one year. How much
is the actual rate of interest?
A. 19.05%
B. 19.34%
C. 19.67%
D. 19.87%
491. P4,000 is borrowed for 75 days at

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
492. Agnes Abanilla was granted a loan of
P20,000 by her employer CPM Industrial
Fabricator and Construction Corporation
with an interest rate of 6% for 180 days on
the principal collected in advance. The
note for P20,000 non-interest for 180
days. If discounted at once, find the
proceeds of the note.
A. P18,800
B. P18,900
C. P19,000
D. P19,100
493. If you borrow money from your friend
with simple interest of 12%, find the
present worth of P20,000 which is due at
the end of nine months.
A. P18,992.08
B. P18,782.18
C. P18,348.62
D. P18,120.45
494. A man borrowed from a bank under a
promissory note that he signed in the
amount of P25,000.00 for a period of one
year. He receives only the amount of
P21,915.00 after the bank collected the
advance interest and an additional of
P85.00 for notarial and inspection fees.
What was the rate of interest that the
bank collected in advance?
A. 13.05%
B. 13.22%
C. 13.46%
D. 13.64%
495. Mr. Danilo Conde borrowed money
from a bank. He received from the bank
at the end of 9 months. Determine rate of
simple interest.
A. 15.92%
B. 15.75%
C. 15.45%
D. 15.08%
496. Mr. J. Dela Cruz borrowed money

from a bank. He receives from the bank
corresponding discount rate or often
referred to as the bankers discount.
A. 13.15%
B. 13.32%
C. 13.46%
D. 13.73%
497. Annie buys a television set from a
merchant who ask P1,250.00 at the end
of 60 days. Annie wishes to pay
immediately and the merchant offers to
compute the cash price on the
assumption that money is worth 8%
simple interest. What is the cash price?
A. P1,124.67
B. P1,233.55
C. P1,289.08
D. P1,302.67
498. A man borrowed money from a loan
shark. He receives from the loan shark
and amount of P1,342.00 and promised to
repay P1,500.00 at the end of 3 quarters.
What is the simple interest rate?
A. 15.47%
B. 15.69%
C. 15.80%
D. 15.96%
499. Determine the exact simple interest
on P5,000 invested for the period from
January 15,1996 to October 12,1996, if
the rate interest is 18%.
A. P664.23
B. P664.89
C. P665.21
D. P666.39
500. The exact simple interest of P5,000
invested from June 21,1995 to December
25,1995 is P100. What is the rate of
interest?
A. 3.90%
B. 3.92%
C. 3.95%
D. 3.98%
Choose the letter of the best answer in
each questions.
501. On her recent birthday, April 22,

2001, Nicole was given by her mother a
certain sum of money as birthday present.
She decided to invest the said amount on
20% exact simple interest. If the account
will mature on Christmas day at an
amount of P10,000.00, how much did
Nicole receive from her mother on her
birthday?
A. P8,807.92
B. P8,827.56
C. P8,832.17
D. P8,845.78
502. What is the ordinary interest on
P1,500.50 for 182 days at 5.2%?
A. P39.01
B. P39.45
C. P39.82
D. P39.99
503. Nicole has P20,400 in cash. She
invested it at 7% from March 1, 2006 to
November 1, 2006 at 7% interest. How
much is the interest using the Bankers
Rule?
A. P972.12
B. P970.78
C. P973.12
D. P971.83
deposited in a bank earning an interest of
6.5% per annum. Determine the total
amount at the end of 7 years if the
principal and interest were not withdrawn
during this period?
A. P30,890.22
B. P30,980.22
C. P31,079.73
D. P31,179.37
505. A loan for P50,000 is to be paid in 3
years at the amount of P65,000. What is
the effective rate of money?
A. 9.01%
B. 9.14%
C. 9.31%
D. 9.41%
deposited in the bank earning an interest
of 7.5% per annum. Determine the total
amount at the end of 5 years, if the

during the period.
A. P71,781.47
B. P71,187.47
C. P71,817.47
D. P71,718.47
payment of P80,000 to be made in six
A. P40,540.49
B. P40,450.49
C. P40,350.49
D. P40,530.49
corresponding to 18% compounded daily?
Take 1 year is equal to 360 days.
A. 19.61%
B. 19.44%
C. 19.31%
D. 19.72%
509. What nominal rate, compounded
semi-annually, yields the same amount as
16% compounded quarterly?
A. 16.09%
B. 16.32%
C. 16.45%
D. 16.78%
510. What rate of interest compounded
annually is the same as the rate of
interest of 8% compounded quarterly?
A. 8.07%
B. 8.12%
C. 8.16%
D. 8.24%
511. Find the nominal rate, which if
converted quarterly could be used instead
of 12% compounded semi-annually.
A. 11.83%
B. 11.09%
C. 11.65%
D. 11.25%
A. 12.35% compounded
annually
B. 11.90% compounded semiannually
C. 12.20% compounded
quarterly
D. 11.60% compounded
monthly
513. Find the compound amount if P2,500
is invested at 8% compounded quarterly
for 5 years and 6 months.
A. P3,864.95
B. P3,846.59
C. P3,889.95
D. P3,844.95
514. An amount of P1,000 becomes
P1,608.44 after 4 years compounded
bimonthly. Find the nominal interest.
A. 11.89%
B. 12.00%
C. 12.08%
D. 12.32%
515. If P5,000 shall accumulate for 10
years at 8% compounded quarterly, then
what is the compound interest at the end
of 10 years?
A. P6,080.40
B. P6,020.40
C. P6,040.20
D. P6,060.20
rate of 18% compounded semi-quarterly?
A. 19.24%
B. 19.48%
C. 19.84%
D. 19.92%
A. P30,555.68
B. P30,656.86
C. P30,556.86
D. P30,655.68
518. In how many years is required for
P2,000 to increase by P3,000 if interest at
12% compounded semi-annually?
A. 7.86 years
B. 7.65 years
C. 7.23 years
D. 8.12 years
deposited in the bank earning an interest
of 7.5% per annum. Determine the total

amount at the end of 5 years, if the
during the period.
A. P215,344.40
B. P213,544.40
C. P234,153.40
D. P255.443.10
520. How long will it take money to double
annually?
A. 13.7 years
B. 14.2 years
C. 14.7 years
D. 15.3 years
interest rate of 18% compounded semimonthly?
A. 19.35%
B. 19.84%
C. 19.48%
D. 19.64%
522. What is the effective rate of 14%
compounded semi-annually?
A. 14.49%
B. 14.59%
C. 14.69%
D. 14.79%
523. At an interest rate of 10%
compounded annually, how much will a
deposit of P1,500 be in 15 years?
A. P6,265.87
B. P6,256.78
C. P6,526.87
D. P6,652.78
8 years. How much is that money worth
now considering interest at 8%
A. P13,256.83
B. P13,655.28
C. P13,625.83
D. P13,265.83
525. About how many years will P100,000
earn a compound interest of P50,000 if
the interest rate is 9% compounded
quarterly?
A. 4 years
B. 5 years
C. 6 years
D. 7 years
526. Compute the equivalent rate of 6%
compounded semi-annually to a rate
A. 5.12%
B. 5.96%
C. 5.78%
D. 6.12%
527. What is the amount of P12,800 in 4
years at 5% compounded quarterly?
A. P15,461.59
B. P15,146.95
C. P15,641.59
D. P15,614.59
P20,000 is left to a girl to be held in trust
money if the fund is invested at 8%
A. 11.23 years
B. 11.46 years
C. 11.57 years
D. 11.87 years
529. If P50,000 shall accumulate for 10
years at 4% compounded quarterly, find
the compounded interest at the end of 10
years.
A. P2,333.32
B. P2,444.32
C. P2,555.32
D. P2,666.32
left for eight years, at which time the
principal is withdrawn. The interest has
accrued is left 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.
A. P693.12
B. P700.12
C. P702.15
D. P705.42
531. P1,500.00 was deposited in a bank
account, 20 years ago. Today, it is worth
P3,000.00. Interest is paid semi-annually.
Determine the interest rate paid on this
account.
A. 2.9%

B. 3.0%
C. 3.2%
D. 3.5%
532. A merchant puts in his P2,000.00 to
a small business for a period of six years.
With a given interest rate on the
investment of 15% per year, compounded
annually, how much will he collect at the
end of the sixth year?
A. P4,626.12
B. P4,262.12
C. P4,383.12
D. P4,444.12
533. A man borrowed P100,000 at the
interest rate of 12% per annum,
compounded quarterly. What is the
effective rate?
A. 12.75%
B. 12.55%
C. 12.45%
D. 12.35%
534. Mandarin Bank advertises 9.5%
account that yields 9.84% annually. Find
how often the interest is compounded.
A. Monthly
B. Bimonthly
C. Quarterly
D. Annually
535. When will an amount be tripled with
an interest of 11.56%?
A. 9 years
B. 10 years
C. 11 years
D. 12 years
536. A student plans to deposit P1,500.00
in the bank now and another P3,000.00
for the next 2 years. If he plans to
withdraw P5,000.00 three years from after
his last deposit for the purpose of buying
shoes, what will be the amount of money
left in the bank after one year of his
withdrawal? Effective annual interest rate
is 10%.
A. P1,549.64
B. P1,459.64
C. P1,345.98
D. P1,945.64
537. How much must be invested on
January 1, 1998 in order to accumulate
P2,000 on January 1, 2003? Money is

worth 6%.
A. P1,509.34
B. P1,249.64
C. P1,378.98
D. P1,494.52
538. A nominal interest of 3%
compounded continuously is given on the
account. What is the accumulated amount
of P10,000 after 10 years?
A. P13,498.59
B. P13,489.59
C. P13,789.98
D. P13,494.52
539. A mechanical engineer wishes to
accumulate a total of P10,000 in a
savings account at the end of 10 years. If
the bank pays only 4% compounded
quarterly, what should be the initial
deposit?
A. P6,176.35
B. P6,761.35
C. P6,716.53
D. P6,167.35
540. Funds are deposited in a savings
account at an interest of 8% per annum.
What is the initial amount that must be
deposited to yield a total of P10,000 in 10
years?
A. P4,196.30
B. P4,721.39
C. P4,796.03
D. P4,631.93
541. If P500,000 is deposited at a rate of
11.25% compounded monthly, determine
the compounded interest after 7 years
and 9 months.
A. P690,848.73
B. P670,651.23
C. P680,649.56
D. P685,781.25
542. An interest rate is quoted as being
7.5% compounded quarterly. What is the
effective annual interest rate?
A. 7.91%
B. 7.51%
C. 7.71%
D. 7.31%

bank at a rate of 18% per year. How much
lesser you will pay by borrowing the
money from the bank?
A. P53.89
B. P54.66
C. P53.78
D. P54.98
544. A deposit of P1,000 is made in a
bank account that pays 8% interest
compounded annually. Approximately how
much money will be in the account after
10 years?
A. P2,187.39
B. P2,145.78
C. P2,176.45
D. P2,158.92
545. Fifteen years ago P1,000.00 was
deposited in a bank account, and today it
is worth P2,370.00. The bank pays
interest semi-annually. What was the
interest rate paid in this account?
A. 5.72%
B. 5.78%
C. 5.84%
D. 5.90%
546. P200,000 was deposited on January
1, 1988 at an interest rate of 24%
compounded semi-annually. How much
would the sum be on January 1, 1993?
A. P631,627.78
B. P612,890.76
C. P621,169.64
D. P611,672.18
547. What is the present worth of two
P100 payments at the end of the third
year and fourth year? The annual interest
rate is 8%.
A. P150.56
B. P152.88
C. P153.89
D. P151.09
548. Consider a deposit of P600.00 to be
paid back in one year by P700.00. What is
the rate of interest, i% per year
compounded annually such that the net
present worth of the investment is
positive? Assume i 0.
A. 16.50%
B. 16.75%
C. 16.33%
D. 16.67%
549. A firm borrows P2,000 for 6 years at
8 %. At the end of 6 years, it renews the
due?
A. P3,260.34
B. P3,280.34
C. P3,270.34
D. P3,250.34
550. A machine has been purchased and
installed at a total cost of P18,000.00. The
machine will retire 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 an exact duplicate. The
company plans to establish a reserve
funds to accumulate the capital needed to
replace the machine. If an average annual
rate of inflation of 3% is anticipated, how
much capital must be accumulated?
A. P18,854.38
B. P18,548.38
C. P18,458.38
D. P18,845,38
corresponding to 16% compounding
daily? Take 1 year = 360 days.
A. 17.35%
B. 17.45%
C. 17.55%
D. 17.65%
P25,000 is left to a girl to be held in a trust
money if the fund is invested at 8%
A. 7.42 years
B. 7.67 years
C. 7.85 years
D. 7.98 years
553. P200,000 was deposited at an
interest rate of 24% compounded semiannually. After how many years will the
sum be P621,170?
A. 4 years
B. 5 years
C. 6 years
D. 7 years
554. In year zero, you invest P10,000.00
in a 15% security for 5 years. During that
How much, in terms of year zero pesos
will be in the account at maturity?
A. P15,030.03
B. P20,113.57
C. P18,289.05
D. P16,892.34
555. A company invests P10,000 today to
be repaid in 5 years in one lump sum at
12% compounded annually. How much
profit in present day pesos is realized?
A. P7,563.29
B. P7,498.20
C. P7,340.12
D. P7,623.42
556. How long (in nearest years) will it
take money to quadruple if it earns 7%
compounded semi-annually?
A. 20 years
B. 18 years
C. 21 years
D. 19 years
557. How much should you put into a 10%
savings account in order to have
P10,000.00 in five years?
A. P6,216.21
B. P6,212.12
C. P6,218.21
D. P6,209.21
10 years. How much is that money worth
now considering interest at 6%
A. P11,042.89
B. P11,035.12
C. P11,025.25
D. P11,012.52
559. P500,000 was deposited 20.15 years
ago at an interest rate of 7% compounded
semi-annually. How much is the sum
now?
A. P2,000,033.33
B. P2,000,166.28
C. P2,001,450.23
D. P2,002,820.12
560. A bank pays one percent interest on

savings accounts four times a year. What
is the effective annual interest rate?
A. 4.06%
B. 4.12%
C. 4.16%
D. 4.28%
561. 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. How much must
he pay at the end of two years if money is
worth 5% compounded semi-annually?
A. P39,015.23
B. P39,026.25
C. P39,056.21
D. P39,089/78
562. Find the difference between simple
interest and compound interest on a
savings deposit of P50,000 at 10% per
annum for 3 years.
A. P1,510
B. P1,530
C. P1,550
D. P1,570
563. If money is worth 5% compounded
quarterly, find the equated time for paying
a loan of P150,000 due in 1 year and
P280,000 due in 2 years.
A. 1.52 years
B. 1.64 years
C. 1.69 years
D. 1.72 years
564. For a loan acquired six years ago, a
man paid out the amount of P75,000.00.
The interest was computed at 18%
compounded annually. How much was the
borrowed amount?
A. P27,367.28
B. P27,278.36
C. P27,782.36
D. P27,872.63
565. A couple decided that for every child
that will be born to them they will place a
deposit in the bank so that on the childs
18th birthday, the child will receive the
amount of P300,000.00. If the bank will
pay an interest of 18% compounded
yearly, how much deposit will the couple
have to make on the birth of a child to

them?
A. P15,367.18
B. P15,249.13
C. P15,722.16
D. P15,482.64
566. On his 6th birthday a boy is left an
inheritance. The inheritance will be paid in
a lump sum of P10,000 on his
21st birthday. What is the present value of
the inheritance as of the boys 6th birthday,
if the interest is compounded annually?
Assume i = 4%.
A. P5,552.64
B. P5,549.10
C. P5,522.12
D. P5,582.63
567. A man who won P300,000 in a lottery
decided to place 50% of his winning in a
trust fund for the college education of his
son. If the money will earn 14% per year
compounded quarterly, how much will the
man have at the end of 10 years when his
son will be starting his college education?
A. P593,120.12
B. P593,452.12
C. P592,739.96
D. P593,888.96
568. If the sum of P15,000 is deposited in
an account earning 4% per annum
compounded quarterly, what will be the
deposited amount at the end of 5 years?
A. P18,302.85
B. P18,450.89
C. P18,512.83
D. P18,638.29
569. The Philippine Society of Mechanical
Engineers is planning to put up its own
building. Two proposals being considered
are:
a. The construction of the building now to
cost P400,000.
b. The construction of a smaller building
now to cost P300,000 and at the end of 5
years, an extension to be added to cost
P200,000.
By how much is proposal B more
economical than proposal A if interest
rate is 20% and depreciation is to be
neglected?
A. P19,122.15
B. P19,423.69
C. P19,518.03
D. P19,624.49
570. A credit plan charges interest rate of
36% compounded monthly. Find its
effective rate.
A. 42.21%
B. 42.30%
C. 42.41%
D. 42.57%
571. A master card compounds monthly
and charges an interest of 1.5% per
month. What is the effective interest rate
per year?
A. 19.23%
B. 19.45%
C. 19.56%
D. 19.65%
10 years. If interest is computed at 6%
compounded quarterly, how much is it
worth today?
A. P11,025.25
B. P11,035.25
C. P11,045.25
D. P11,055.25
573. Microsoft CEO, billionaire Bill Gates
willed that a sum of $25 million be given
to a child but will be held in trust by the
childs mother until it amounts to $45
million. If the amount is invested and
earns 8% compounded quarterly, when
will the child receive the money?
A. 8.11 years
B. 7.90 years
C. 7.42 years
D. 7.24 years
574. Find the present value of installment
payments of P1,000 now, P2,000 at the
end of the first year, P3,000 at the end of
the second year, P4,000 at the end of the
third year and P5,000 at the end of the
fourth year, if money is worth 10%
A. P11,411.10
B. P11,530.98
C. P11,621.67
D. P11,717.85
575. How long will it take money to triple

annually?
A. 14.27 years
B. 14.56 years
C. 14.78 years
D. 14.98 years
576. Two hundred years ago, your great,
great, great grandfather deposited P1 in a
savings account. Today, the bank notified
you that you are the sole heir to this
account. How much is the account today if
it earns 8% per annum?
A. P4,002,450.78
B. P4,102,405.90
C. P4,838,949.58
D. P4,909,289.45
577. What is the present worth of a future
A. P76,901.21
B. P77,108.66
C. P78,109.32
D. P79,667.32
578. A deposit of P1,000.00 is made in a
bank account that pays 8% interest
compounded annually. How much money
will be in the account after 10 years?
A. P2,374.21
B. P2,158.92
C. P2,734.12
D. P2,400.12
579. What nominal rate compounded
annually would quadruple the principal in
4 years?
A. 41.42%
B. 40.81%
C. 41.79%
D. 40.45%
580. Five years ago, you paid P34,000 for
a residential lot. Today you sell it at
P50,000. What is your annual rate of
appreciation?
A. 8.12%
B. 8.00%
C. 7.92%
D. 8.32%
581. Suppose that P100,000 is invested
at a certain rate of interest compounded
annually for 2 years. If the accumulated

interest at the end of 2 years is P21,000.
Find the rate of interest.
A. 10.12%
B. 10.00%
C. 10.92%
D. 10.32%
582. An investment of P20,000 will be
required at the end of the year. The
project would terminate at the end of the
5th year and the assets are estimated to
have a salvage value of P25,000 at that
time. What is the rate of interest for this
project to break even?
A. 5.74%
B. 5.43%
C. 5.91%
D. 5.67%
583. Robin Padilla possesses a
promissory note, due in 2 years hence,
whose maturity value is P3,200. What is
the discount value of this note, based on
an interest rate of 7%?
A. P2,795.00
B. P2,975.00
C. P2,579.00
D. P2,759.00
584. JM borrowed a certain amount on
June 1990 from DJ. Two years later, JM
borrowed again from DJ an amount of
P5,000. JM paid P1,000 on June 1993
and discharged his balance by paying
P7,500 on June 1995. What was the
amount borrowed by JM on June 1990 if
the interest is 8% compounded annually?
A. P1,511.61
B. P1,611.51
C. P1,711.41
D. P1,811.31
585. Dr. Gary Sy invests P50,000 in a
time deposit that yields 10% for his
retirement 30 years from now. If the
inflation rate is 5%, what will be the value
of the account at maturity in terms of
todays peso.
A. P201,689.91
B. P201,571.91
C. P201,345.91
D. P201,869.91
586. First Benchmark Publisher Inc.

invests P100,000 today to be repaid in
five years in one lump sum at 12%
compounded annually. If the rate of
inflation is 4% compounded annually, how
much profit, in todays pesos, is realized
over the five-year period?
A. P44,512.89
B. P44,672.10
C. P44,851.64
D. P44,901.23
587. A manufacturing firm contemplates
retiring an existing machine at the end of
2002. The new machine to replace the
existing one will have an estimated cost of
P400,000. This expense will be partially
defrayed by the sale of the old machine
as scrap for P30,000. To accumulate the
balance of the required capital, the firm
will deposit the following sum in an
account earning interest at 5%
compounded quarterly:
P60,000 at the end of 1999
What cash disbursement will be
necessary at the end of 2002 to purchase
the new machine?
A. P155,890.12
B. P153,085.56
C. P154,200.12
D. P156,930.38
588. On June 1, 1998, Ms. Brenda
Marcial purchased stock of San Miguel
Corporation at a total cost of P144,000.
She then received the following
semiannual dividends:
P4,200 on December 1, 1998
P4,400 on June 1, 1999
P4,400 on December 1, 1999
P4,000 on June 1, 2000
After receiving the last dividend, Ms.
Marcial sold her stock, receiving
P152,000 after deduction of brokerage
fees. What semiannual rate did this
dividend realize on her investment?
A. 4.26%
B. 4.54%
C. 4.87%
D. 4.91%
589. Engr. Narito has P13,760 in cash

Having won the lottery, Mr. Jimenez
and he would like to invest it in business.
decided to liquidate the debts at the
His estimates of the year-by-year receipts
present time. If the two parties agree on a
and disbursements for all purposes are
5% interest rate, what sum must Mr.
shown in the tabulation below:
Jimenez pay?
Year
Receipts
Disbursements
A. P147,520.20
0
0
- P13,760
B. P147,346.02
4
P5,000
+ P1,000
C. P147,902.89
5
P6,200
+ P1,200
D. P147,021.81
6
P7,500
+ P1,500
593. Mr. John Bongat working in the
7
P8,800
+ P1,800
United States planned of returning to the
He estimates that his equipment will have
Philippines at the end of 2001. He
a salvage value of P2,000 at the end of
established a fund starting in 1995 with
useful life. Find the rate of return of the
the following recorded deposits and
prospective equipment.
withdrawals.
A. 10.11%
January 1, 1995 Deposit of P40,000
B. 11.80%
January 1, 1997 Deposit of P80,000
C. 11.10%
July 1, 1997 Withdrawal of P12,000
D. 10.51%
July 1, 1998 Deposit of P64,000
590. What interest rate, compounded
January 1, 1999 Withdrawal of P48,000
monthly, is equivalent to a 10% effective
His fund earned interest at the rate of
rate?
3.5% compounded semiannually until the
end of 1997. At that date, the interest was
A. 9.45%
augmented to 4% compounded
B. 9.26%
semiannually. What will be the principal in
C. 9.65%
the fund at the end of 2001?
D. 9.56%
A. P146,323.08
591. Froyd Wess Network Inc. plans to
B. P146,992.99
purchase a piece of land and to build a
C. P146,846.92
school building on this land. However,
D. P146,022.82
since the school building is not an
immediate requirement, the institute is
594. JRT Publishers is contemplating of
considering whether it should purchase
installing a labor-saving printing
this land and build the building now or
equipment. It has a choice between two
defer this action for 3 years. The current
different models. Model A will cost
costs are as follows:
P1,460,000 while model B will cost
Land: P800,000 Building: P12,000,000
P1,452,000. The anticipated repair costs
The purchase price of the land and the
for each model are as follows:
cost of the school building are expected to Model A: P60,000 at the end of 5th year
appreciate at the rate of 15% and 4% per
P80,000 at the end of 10th year
annum, respectively. What will be the total Model B: P152,000 at the end of 9th year
cost of the land and structure 3 years
The two models are alike in all other
hence?
respects. If the publisher is earning a 7%
return of its capital, which model should
A. P14,520,120
be purchased? How much savings will be
B. P14,715,068
accrued if the publisher will purchase the
C. P14,902,189
more economical model?
D. P15,021,781
A. P8,769.18
592.) Mr. Jimenez owes Mr. Padua the
B. P8,918.23
following amounts:
C. P9,012.53
P40,000 due 2 years hence
D. P9,341.11
595. What is the future amount of

P50,000 if the single payment compound
amount factor of this investment is 1.23%
A. P61,700
B. P61,900
C. P61,200
D. P61,500
596. An investment indicates a single
compound amount factor of 1.32 if
invested for n years. If the interest rate
is 4.73% per annum, find the value of n.
A. 4
B. 5
C. 6
D. 7
597. Mr. Mondragon invests P50,000
today. Several years later, it becomes
P60,000. What is the single payment
present worth factor of this investment? If
the amount was invested for 5 years, what
is the rate of interest?
A. 3.1%
B. 3.3%
C. 3.5%
D. 3.7%
598. Money is deposited in a certain
account for which the interest is
compounded continuously. If the balance
doubles in 6 years, what is the annual
percentage rate?
A. 11.55%
B. 11.66%
C. 11.77%
D. 11.88%
599.) On January 1, 1999, Ms. Angel
Locsin opened an account at Bank of
Philippine Islands with an initial deposit of
P1,000,000.00. On March 1, 2000, she
opened an additional P1,000,000.00. If
the bank pays 12% interest compounded
monthly, how much will be in the account
on April 1, 2000?
A. P2,180,968.95
B. P2,190,968.95
C. P2,160,968.95
D. P2,170,968.95
600. The paper currency issued by the
Central Bank which forms part of the
countrys money supply.
A. T-bills
B. Bank note
C. Check
D. Coupon
601. Reduction in the level of national

by the fall in the general price level.
A. Devaluation
B. Deflation
C. Inflation
D. Depreciation
602. It is a series of equal payments
occurring at equal interval of time.
A. Annuity
B. Debt
C. Amortization
D. Deposit
603. The place where buyers and sellers
come together.
A. Market
B. Business
C. Recreation center
D. Buy and sell section

buyer of an item for which there are no
goods substitute
A. Monopsony
B. Oligopoly
C. Monopoly
D. Oligopsony
occurring at equal interval of time where
the first payment is made after several
periods, after the beginning of the
payment.
A. Perpetuity
B. Ordinary annuity
C. Annuity due
D. Deferred annuity
606. The total income equals the total
operating cost.
A. Balanced sheet
B. In-place value
C. Check and balance
D. Break even no gain no

loss
607. Kind of obligation which has no
condition attached.
A. Analytic

B. Pure
C. Gratuitous
D. Private
608. Direct labor costs incurred in the
factory and direct material costs are the
costs of all materials that go into
production. The sum of these two direct
costs is known as:
A. GS and A expenses
B. Operating and maintenance

costs
C. Prime cost
D. O and M costs
609. An index of short term paying ability
is called:
A. Receivable turn-over
B. Profit margin ratio
C. Current ratio
D. Acid-test ratio
610. Artificial expenses that spread the
purchase price of an asset or another
property over a number of years.
A. Depreciation
B. Sinking fund
C. Amnesty
D. Bond
611. Estimated value at the end of the
useful life.
A. Market value
B. Fair value
C. Salvage value
D. Book value
612. Consists of the actual counting or
determination of the actual quantity of the
materials on hand as of a given date.
B. Material update
C. Technological assessment
D. Material count
613. Additional information of prospective
bidders on contract documents issued
prior to bidding date.
A. Delict
B. Escalatory
C. Technological assessment
D. Bid bulletin
614. A series of uniform accounts over an
infinite period of time.
A. Depreciation
B. Annuity
C. Perpetuity
D. Inflation
615. 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%?
A. P727.17
B. P717.17
C. P714.71
D. P731.17
616. Today, a businessman borrowed
money to be paid in 10 equal payments
for 10 quarters. If the interest rate is 10%
compounded quarterly and the quarterly
payment is P2,000, how much did he
borrow?
A. P17,304.78
B. P17,404.12
C. P17,504.13
D. P17,604.34
617. What annuity is required over 12
years to equate with a future amount of
P20,000? Assume i = 6% annually.
A. P1,290.34
B. P1,185.54
C. P1,107.34
D. P1,205.74
618. Find the annual payment to
extinguish a debt of P10,000 payable for 6
years at 12% interest annually.
A. P2,324.62
B. P2,234.26
C. P2,432.26
D. P2,342.26
619. A manufacturer desires to set aside a
certain sum of money to provide funds to
cover the yearly operating expenses and
the cost of replacing every year the dyes
of a stamping machine used in making
radio chassis as model changes for a
period of 10 years.
Operating cost per year = P500.00
Cost of dye = P1,200.00
Salvage value of dye = P600.00
The money will be deposited in a savings
account which earns 6% interest.
Determine the sum of money that must be
provided, including the cost of the initial
dye.
A. P8,626.02
B. P8,662.02
C. P8,226.02
D. P8,666.22
620. A factory operator bought a diesel
generator set for P10,000.00 and agreed
to pay the dealer uniform sum at the end
of each year for 5 years at 8% interest
compounded annually, that the final
payment will cancel the debt for principal
and interest. What is the annual payment?
A. P2,500.57
B. P2,544.45
C. P2,540.56
D. P2,504.57
621. A man paid 10% downpayment of
P200,000 for a house and lot and agreed
to pay the 90% balance on monthly
installment for 60 months at an interest
rate of 15% compounded monthly.
Compute the amount of the monthly
payment.
A. P42,821.86
B. P42,128.67
C. P42,218.57
D. P42,812.68
622. What is the present worth of a 3 year
annuity paying P3,000.00 at the end of
each year, with interest at 8%
A. P7,654.04
B. P7,731.29
C. P7,420.89
D. P7,590.12
623. What is the accumulated amount of
five-year annuity paying P6,000 at the end
of each year, with interest at 15%
A. P40,519.21
B. P40,681.29
C. P40,454.29
D. P40,329.10
624. A debt of P10,000 with 10% interest
compounded semi-annually is to be
amortized by semi-annual payment over
the next 5 years. The first due in 6
months. Determine the semi-annual
payment.
A. P1,234.09
B. P1,255.90
C. P1,275.68
D. P1,295.05
625. A man borrowed P300,000 from a
lending institution which will be paid after
10 years at an interest rate of 12%
compounded annually. If money is worth
8% per annum, how much should he
deposit to a bank monthly in order to
discharge his debt 10 yrs. hence?
A. P5,174.23
B. P5,162.89
C. P5,190.12
D. P5,194.23
626. A man loans P187,400 from a bank
with interest at 5% compounded annually.
He agrees to pay his obligations by
paying 8 equal annual payments, the first
being due at the end of 10 years. Find the
annual payments.
A. P43,600.10
B. P43,489.47
C. P43,263.91
D. P43,763.20
627. Money borrowed today is to be paid
in 6 equal payments at the end of 6
quarters. If the interest is 12%
compounded quarterly, how much was
initially borrowed if quarterly payment is
P2,000.00?
A. P10,834.38
B. P10,278.12
C. P10,450.00
D. P10,672.90
628. A person buys a piece of lot for
P100,000 downpayment and 10 deferred
semi-annual payments of P8,000 each,
starting three years from now. What is the
present value of the investment if the rate
of interest is 12% compounded semiannually?
A. P142,999.08
B. P143,104.89
C. P142,189.67
D. P143,999.08
629. How much must you invest today in
order to withdraw P2,000 annually for 10
years if the interest rate is 9%?
A. P12,835.32
B. P12,992.22
C. P12,562.09
D. P12,004.59
630. How much must be deposited at 6%
each year beginning on January 1, year 1,
in order to accumulate P5,000 on the date
of the last deposit, January 1, year 6?
A. P728.99
B. P742.09
C. P716.81
D. P702.00
631. A piece of machinery can be bought
for P10,000 cash or for P2,000 down and
payments of P750 per year for 15 years.
What is the annual interest rate for the
time payments?
A. 4.61%
B. 4.71%
C. 4.41%
D. 4.51%
632. 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 required for
redemption. The firm established a
sinking fund consisting of annual deposits,
the interest rate of the fund being 4%.
What was the principal in the fund at the
end of the 12th year?
A. P38,120.00
B. P37,520.34
C. P37,250.34
D. P37,002.00
633. A house and lot can be acquired by a
downpayment of P500,000 and a yearly
payment of P100,000 at the end of each
year for a period of 10 years, starting at
the end of 5 years from the date of
purchase. If money is worth 14%
compounded annually, what is the cash
price of the property?
A. P806,899.33
B. P807,100.12
C. P807,778.12
D. P808,835.92
634. A parent on the day the child is born
wishes to determine what lump sum
would have to be paid into an account
bearing interest at 5% compounded
annually, in order to withdraw P20,000
each on the childs 18th, 19th, 20th and
21st birthdays. How much is the lump sum
amount?

A. P30,119.73
B. P30,941.73
C. P30,149.37
D. P30,419.73
635. An instructor plans to retire in exactly
one year and want an account that will
pay him P25,000 a year for the next 15
years. Assuming a 6% annual effective
interest rate, what is the amount he would
need to deposit now? (The fund will be
depleted after 15 years).
A. P242,860.22
B. P242,680.22
C. P242,608.22
D. P242,806.22
636. A manufacturing firm wishes to give
each 80 employees a holiday bonus. How
much is needed to invest monthly for a
year at 12% nominal interest rate
compounded monthly, so that each
employee will receive a P2,000 bonus?
A. P12,615.80
B. P12,516.80
C. P12,611.80
D. P12,510.80
637. A man purchased on monthly
installment a P100,000 worth of land. The
interest rate is 12% nominal and payable
in 20 years. What is the monthly
amortization?
A. P1,101.08
B. P1,202.08
C. P1,303.08
D. P1,404.08
638. A young engineer borrowed P10,000
at 12% interest and paid P2,000 per
annum for the last 4 years. What does he
have to pay at the end of the fifth year in
order to pay off his loan?
A. P6,999.39
B. P6,292.93
C. P6,222.39
D. P6,922.93
639. An investment of P350,000 is made
today and is equivalent to payments of
P200,000 each year for 3 years. What is
the annual rate of return on investment for
the project?
A. 32.7%
B. 33.8%
C. 33.2%
D. 33.6%
640. 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
641. 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
642. 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%
643. 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
644. The president of a growing
engineering firm wishes to give each of 50
employees a holiday bonus. How much is
needed to invest monthly for a year at
12% nominal rate compounded monthly,
so that each employee will receive a
P1,000.00 bonus?
A. P3,942.44
B. P3,271.22
C. P3,600.12
D. P3,080.32
645. Mr. Padilla plans a deposit of P500 at
the end of each month for 10 years at
12% annual interest, compounded
monthly. What will be the amount that will
be available in 2 years?
A. P13,941.44
B. P13,272.22
C. P13,486.73
D. P13,089.32
646. Mr. Ramirez borrowed P15,000 two
years ago. The terms of the loan are 10%
interest for 10 years with uniform
payments. He just made his second
annual payment. How much principal
does he still owe?
A. P13,841.34
B. P13,472.22
C. P13,286.63
D. P13,023.52
647. A man inherited a regular
endowment of P100,000 every end of 3
months for 10 years. However, he may
choose to get a single lump sum payment
at the end of 4 years. How much is this
lump sum of the cost of money is 14%
A. P3,702,939.73
B. P3,607,562.16
C. P3,799,801.23
D. P3,676,590.12
648. A man paid 10% down payment of
to pay the balance on monthly
installments for x years at an interest
rate of 15% compounded monthly. If the
monthly installment was P42,821.87, find
the value of x?
A. 3
B. 4
C. 5
D. 6
649. You need P4,000 per year for four
years to go to college. Your father
invested P5,000 in 7% account for your
education when you were born. If you
withdraw P4,000 at the end of your 17th,
18th, 19th and 20th birthday, how much will
be left in the account at the end of the

21st year?
A. P1,666.98
B. P1,699.86
C. P1,623.89
D. P1,645.67
650. Mr. Ayala borrows P100,000 at 10%
effective annual interest. He must pay
back the loan over 30 years with uniform
monthly payments due on the first day of
each month. What does Mr. Ayala pay
each month?
A. P839.19
B. P842.38
C. P807.16
D. P814.75
651. A machine is under consideration for
investment. The cost of the machine is
P25,000.00. Each year it operates, the
machine will generate a savings of
P15,000.00. Given the effective annual
interest rate of 18%, what is the
discounted payback period, in years, on
the investment of the machine?
A. 3.15
B. 1.75
C. 2.15
D. 2.75
652. A machine costs P20,000.00 today

and has an estimated scrap value of
P2,000.00 after 8 years. Inflation is 2%
per year. The effective annual interest rate
earned on money invested is 8%. How
much money needs to be set aside each
year to replace the machine with an
identical model 8 years from now?
653. Engr. Santos borrows P100,000.00

at 10% effective annual interest. He must
pay back the loan over 30 years with
uniform monthly payment due on the first
day of each month. What does Engr.
Santos pay each month?
A. P838.86
B. P849.12
C. P850.12
D. P840.21
654. Instead of paying P100,000.00 in

annual rent for office space at the
beginning of each year for the next 10
years, an engineering firm has decided to
take out a 10-year P1,000,000.00 loan for
a new building at 6% interest. The firm will
invest P100,000.00 of the rent saved and
earn 18% annual interest on that amount.
What will be the difference between the
firms annual revenue and expenses?
A. P10,200.12
B. P10,205.13
C. P10,210.67
D. P10,215.56
655. A service car whose cash price was

P540,000 was bought with a
downpayment of P162,000 and monthly
installment of P10,874.29 for 5 years.
What was the rate of interest if
compounded 5monthly?
A. 20%
B. 24%
A. P3,345.77
C. 21%
B. P3,389.32
D. 23%
C. P3,489.11
D. P3,573.99
656. What uniform annual amount should

be deposited each year in order to
accumulate P100,000.00 at the end of the

5th annual deposit if money earns 10%
interest?
A. P16,002.18
B. P15,890.12
C. P16,379.75
D. P15,980.12
657. In five years, P18,000 will be needed

to pay for a building renovation. In order
to generate this sum, a sinking fund
consisting of three annual payments is
established now. For tax purposes, no
further payment will be made after three
years. What payments are necessary if
money worth 15% per annum?
C. P3,450.12
D. P3,576.64
660. How many years must you invest

today in order to withdraw P1,000.00 per
year for 10 years if the interest rate is
12%?
B. P5,560.22
C. P5,650.22
D. P5,780.12
661. A man paid a 10% down payment of

to pay the balance on monthly
installments for 5 years at an interest rate
of 15% compounded monthly. What was
the monthly installment in pesos?
A. P3,919.52
B. P3,871.23
C. P3,781.32
A. P42,821.87
D. P3,199.52
B. P42,980.00
C. P43,102.23
D. P43,189.03
A. P371,719.52
B. P371,287.13
C. P371,670.34
D. P371,802.63
659. If P500.00 is invested at the end of

each year for 6 years, at an annual
interest rate of 7%, what is the total peso
amount available upon the deposit of the
sixth payment?
A. P3,671.71
B. P3,712.87
A. P13,994.17
B. P14,801.12
C. P13,720.15
D. P14,078.78
A. P5,467.12
658. Find the present value in pesos, of a

perpetuity of P15,000 payable semiannually if money is worth 8%
you pay monthly to amortize the loan

within a period of 10 years?
662. A man inherited a regular

endowment of P100,000.00 every end of
3 months for x years. However, he may
choose to get a single lump sum of
P3,702,939.80 at the end of 4 years. If the
rate of interest was 14% compounded
quarterly, what is the value of x?
A. 10
B. 11
C. 12
D. 13
663. If you obtain a loan of P1M at the

rate of 12% compounded annually in
order to build a house, how much must
664. Rej Averion borrowed P50,000.00

from Social Security System, in the form
of calamity loan, with interest at 8%
compounded quarterly payable in equal
quarterly installments for 10 years. Find
the quarterly payments.
A. P1,590.83
B. P1.609.23
C. P1,778.17
D. P1,827.79
665. For having been loyal, trustworthy

and efficient, the company has offered a
supervisor a yearly gratuity pay of
P20,000.00 for 10 years with the first
payment to be made one year after his
retirement. The supervisor, instead,
requested that he be paid a lump sum on
the date of his retirement less interact that
the company would have earned if the
gratuity is to be paid on the yearly basis. If
interest is 15%, what is the equivalently
lump sum that he could get?
A. P100,357.37
B. P100,537.73
C. P100,375.37
D. P100,735.37
666. In anticipation of a much bigger

volume of business after 10 years, a
fabrication company purchased an
adjacent lot for its expansion program
where it hopes to put up a building

projected to cost P4,000,000.00 when it
will be constructed 10 years after, To
provide the required capital expense, it
plans to put up a sinking fund for the
purpose. How much must the company
deposit each year if interest to be earned
is computed at 15%?
A. P194,089.17
B. P195,780.12
C. P196,801.56
D. P197,008.25
667. 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
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. How much is his
monthly payment?
A. P8,929.29
B. P8,225.00
C. P8,552.00
D. P8,008.20
668. 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
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
669. 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
670. A car dealer advertises the sale of a

car model for a cash price of P280,000. If
purchased on installment, the regular
downpayment is 15% and balance
payable in 18 equal monthly installments
at an interest rate of 1.5% per month.
How much will be required monthly
payments?
A. P15,185.78
B. P15,289.12
C. P15,783.90
D. P15,632.11
671. A machinery supplier is offering a

certain machinery on a 10%
downpayment and the balance payable in
equal end of the year payments without
interest for 2 years. Under this
arrangement, the price is pegged to be
P250,000. However, for cash purchase,
the machine would only cost P195,000.
What is the equivalent interest rate that is

being charged on the 2-year payment
plan if interest is compounded quarterly?
of a car he can purchase if the seller will

agree to a downpayment of P10,000.00
and the balance payable in four years at
18% per year payable on monthly basis?
The first payment will be due at the end of
the first month?
A. 18.47%
B. 19.21%
C. 19.47%
A. P135,267.21
D. 19.74%
B. P135,507.42
C. P135,605.48
D. P135,807.30
672. A company has approved a car plan

for its six senior officers in which the
company will shoulder 25% of the cost
and the difference payable by each officer
to a financing company in 48 equal end of
the month installments at an interest rate
of 1.5% per month. If the cost of each car
is P350,000, determine the amount each
officer has to pay the financing company
per month?
A. P7,523.90
B. P7,619.22
C. P7,190.00
D. P7,710.94
673. If P10,000 is deposited each year for

9 years, how much annuity can a person
get annually from the bank every year for
8 years starting 1 year after the 9th deposit
is made. Cost of money is 14%.
675. A new company developed a

program in which the employees will be
allowed to purchase shares of stocks of
the company at the end of its fifth year of
operation, when the companys thought to
have gained stability already. The stock
has a par value of P100.00 per share.
Believing in the good potential of the
company, an employee decided to save in
a bank the amount of P8,000.00 at the
end of every year which will earn for him
9% interest, compounded annually.
How much shares of stocks will he be
able to purchase at the end of the fifth
year of his yearly deposits?
B. P72,000.80
C. P72,173.90
D. P72,311.44
677. A debt of P12,000 with an interest of

20% compounded quarterly is to be
amortized by equal semi-annual
payments over the next three years, the
first due in 6 months. How much is the
semi-annual payments?
A. P2,775.50
B. P2,662.89
C. P2,590.04
D. P2,409.78
678. A fund donated by a benefactor to

PICE to provide annual scholarships to
deserving CE students. The fund will
grant P5,000 for each of the first five
years, P8,000 for the next five years and
P10,000 each year thereafter. The
scholarship will start one year after the
fund is established. If the fund earns 8%
interest, what is the amount of the
donation?
A. P99,490.00
B. P99,507.35
A. 476
B. 478
C. P99,601.71
D. P99,723.54
A. P34,467.21
C. 480
B. P34,567.81
D. 482
C. P34,675.18
D. P34,867.37
674. An employee is earning P12,000.00

a month and he can afford to purchase a
car which will require a downpayment of
P10,000.00 and a monthly amortization of
not more than 30% of his monthly salary.
What should be the maximum cash value
676. Mr. Juan dela Cruz borrows

P100,000 at 10% compounded annually,
agreeing to repay the loan in twenty equal
annual payments. How much of the
original principal is still unpaid after he
has made the tenth payment?
A. P69,890.42
679. If a low cost house and lot worth

P87,000 were offered at 10%
downpayment and P500 per month for 25
years, what is the effective monthly
interest rate on the diminishing balance?
D. 49.2%
680. The average annual cost of damages

caused by floods at Dona Rosario Village
located along Butuanon river is estimated
at P700,000. To build a gravity dam to
protect the area from the floods, would
cost P2,500,000 and would involve an
annual maintenance cost of P20,000.
With interest at 8% compounded annually,
how many years will it take for the dam to
pay for itself?
683. Rona wishes to purchase a 29-inch

flat-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. 4.0 years
A. 36.71%
B. 4.5 years
B. 36.21%
C. 5.0 years
C. 35.89%
D. 5.5 years
D. 35.23%
681. A businessman borrowed

P10,000.00 from a bank at 12% interest,
and paid P2,000.00 per annum for the first
4 years. What does he pay at the end of
the fifth year in order to pay-off the loan?
A. P6,812.54
B. P6,782.31
C. P6,917.72
D. P6,660.90
682. Engr. Rodel Narito agreed to pay the

loan he is borrowing from a development
bank in six annual end-of-the-year
payments of P71,477.70. Interest is 18%
per annum compounded annually and is
included in the yearly amount he will be
paying the bank. How much money Engr.
Narito is borrowing from the bank?
A. P250,000
A. 0.492%
B. P260,000
B. 4.92%
C. P270,000
C. 0.0492%
D. P280,000
684. 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
685. 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
686. Because of the peso devaluation, a

car costing P150,000 is to be purchased
through a finance company instead of
paying cash. If the buyer is required to
pay P40,000 as downpayment and
P4,000 each month for 4 years, what is
the effective interest rate on the
diminishing balance?
B. P233,070.12
A. P217,520.05
C. P234,070.34
B. P216,980.12
D. P234,560.12
C. P217,679.01
A. P40.76
D. P216,733.29
B. P41.90
C. P43.54
D. P45.95
688. Triple J Construction Firm had put up

for sale of some of their heavy
equipments for construction works. There
were two interested buyers submitting
their respective bids for the heavy
equipments. The bids are as follows:
Buyer A offers P10,000,000 payable 20%
downpayment, the balance payable
P1,000,000 annually for 8 years. Buyer
B offers P9,000,000 payable P2,000,000
down payment, the balance payable
P500,000 semi-annually for 7 years.
How much is the difference between the
two bids if money is worth 10% effective?
A. P346,520.05
B. P346,980.12
A. 35.28%
C. P347,019.45
B. 35.82%
D. P347,733.29
C. 34.89%
D. 34.29%
687. Engr. Edwin Astorga plans to

purchase a new office building costing
P1,000,000. He can raise the building by
issuing 10%, 20-year bond that would pay
P150,000 interest per year and repay the
face amount at maturity. Instead of buying
the new building, he can least it for
P140,000 per year, first payment being
due one year from now. The building has
an expected life of 20 years. Ignoring
effects on income tax, what is the
difference between buying the building
and leasing the building?
A. P233,779.27
689. Froyd Review & Training Center Inc.

is expanding its school facilities starting
2001. The program requires the following
estimated expenditures:
P1,000,000 at the end of 2001
P1,200,000 at the end of 2002
P1,500,000 at the end of 2003
To accumulate the required funds, it
establish a sinking fund constituting of 15
uniform annual deposits, the first deposit
has been made at the end of 1992. The
interest rate of the fund is 2% per annum.
Calculate the annual deposit.
690. Froyd Review & Training Center Inc.

is expanding its school facilities starting
2001. The program requires the following
estimated expenditures:
P1,000,000 at the end of 2001
P1,200,000 at the end of 2002
P1,500,000 at the end of 2003
To accumulate the required funds, it
establish a sinking fund constituting of 15
uniform annual deposits, the first deposit
has been made at the end of 1992. The
interest rate of the fund is 2% per annum.
Calculate the balance in the fund on
January 1, 2002.
A. P2,185,902.11
B. P2,195,600.03
C. P2,165,399.54
D. P2,175,380.00
691. Padilla Pawnshop sells jewelries on

either of the following arrangements:
buying in installment? Assume that money

is worth 5%.
692. Lim Bon Fing Y Hermanos Inc has

offered for sale its two-storey building in
the commercial district of Cebu City. The
building contains two stores on the ground
floor and a number of offices on the
second floor.
A prospective buyer estimates that if he
buys this property, he will hold it for about
10 years. He estimates that the average
receipts from the rental during this period
to be P350,000.00 and the average
expenses for all purpose in connection
with its ownership and operation
(maintenance and repairs, janitorial
services, insurance, etc.) to be
P135,000.00. He believes that the
property can be sold for a net of
P2,000,000 at the end of the 10th year. If
the rate of return on this type of
investment is 7%, determine the cash
price of this property for the buyer to
recover his investment with a 7% return
before income taxes.
A. P2,526,768.61
Cash Price: Discount of 10% of the

marked price
B. P2,490,156.34
C. P2,390,189.00
Installment: Downpayment of 20% of the

marked price and the balance payable in
equal annual installments for the next 4
years.
D. P2,230,120.56
If you are buying a necklace with a

marked price of P5,000, how much is the
difference between buying in cash and
693. Bicol Hardware Inc is considering

two alternative strategies for a new power
tool. According to Jun Ramos who is
introducing the power tool, the new
product will require an outlay of P30,000
with a low price strategy. The product will
generate cash proceeds of P20,000 per

year and will have a life to two years. With
a high price strategy, the product will
generate cash proceeds of P36,000 but
will have a life of only one year. The cost
of money for the company is 10%.
Determine the net present value of the
low price strategy.
A. P34,389.12
B. P34,490.10
C. P34,518.89
D. P34,710.74
694. Bicol Hardware Inc is considering

two alternative strategies for a new power
tool. According to Jun Ramos who is
introducing the power tool, the new
product will require an outlay of P30,000
with a low price strategy. The product will
generate cash proceeds of P20,000 per
year and will have a life to two years. With
a high price strategy, the product will
generate cash proceeds of P36,000 but
will have a life of only one year. The cost
of money for the company is 10%.
Determine the net present value of the
high price strategy.
A. P32,727.27
B. P33,737.34
C. P33,747.20
D. P33,757.89
695. John Smith plans to purchase a new

house costing P1,000,000. He can raise
the building by issuing a 10%, 20 year old
bond that would pay P150,000 interest
per year and repay the face amount at
maturity. Instead of buying the new house,
Jan Michael has an option of leasing it for
P140,000 per year, the first payment due
one year from now. The building has an
expected life of 20 years. If interest
charge for leasing is 12%, which of the

following is true?
A. Lease is more economical

than borrow and buy.
B. Lease has same result with

borrow and buy.
C. Borrow and buy is half the

value than lease.
D. Borrow and buy is

economical by almost a
hundred thousand than lease.
696. Engr. Edward Zuela is considering

establishing his own business. An
investment of P100,000 will be required
which must be recovered in 15 years. It is
estimated that sales will be P150,000 per
year and that annual operating expenses
will be as follows:
B. No, it is not a sound idea
B. P815.80
C. Neither yes nor no because

it simply breakeven
C. P830.12
D. P846.10
D. It depends on the current

demand of the market.
697. A housewife bought a brand new

washing machine costing P12,000 if paid
in cash. However, she can purchase it on
installment basis to be paid within 5 years.
If money is worth 8% compounded
annually, what is her yearly amortization if
all payments are to be made at the
beginning of each year?
A. P2,617.65
B. P2,782.93
C. P2,890.13
D. P2,589.90
698. A Civil Engineering student borrowed

P40,000
P2,000.00 to meet college expenses
during his senior year. He promised to
repay the loan with interest at 4.5% in 10
equal semi-annual installments, the first
P70,000
payment to be made 3 years after the
date of the loan. How much will this
payment be?
P10,000 + 10% of sales
Materials
Labor
Overhead
Selling expenses
Engr. Zuela will give up his regular job

paying P15,000 per year and devote full
time to the operation of the business. This
will result in decreasing labor cost by
P10,000 per year, material cost by P7,000
per year and overhead cost by P8,000 per
year. If he expects to earn at least 20% of
his capital, is investing in this business a
sound idea?
A. Yes, it is a sound idea
A. P252.12
P5,000
B. P261.89
C. P273.90
D. P280.94
699. A father wishes to provide P40,000

for his son on his sons 21st birthday. How
much should he deposit every 6 months in
a savings account which pays 3%
compounded semi-annually, if the first
deposit was made when the son was 3
years old?
A. P829.68
700. A group of Filipino Mechanical

Engineers formed a corporation and the
opportunity to invest P8,000,000 in either
of the two situations. The first is to expand
a domestic operation. It is estimated that
this investment would return a net year
end cash flow of P2,000,000 each year for
10 years and at the end of that time, the
physical assets, which would no longer be
needed, could be sold at P5,000,000. The
alternative opportunity would involve
building and operating a plant in a foreign
country. This operation would involve no
net cash flow during the first 3 years, but it
is believed that, beginning with the end of
the fourth year, an annual flow of
P4,000,000 would be received, running
through the 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 following is true?
A. Foreign operation yields

bigger rate of return.
B. Domestic and foreign

operations yield the same rate
of return.
C. Domestic operation has

double the rate of return of the
foreign operation.
D. Foreign operation yields

approximately 3% less rate of
return than domestic operation.
701. A house costs P400,000 cash. A

purchaser will pay P90,000 cash, P60,000
at the end of 2 years and a sequence of 6
equal annual payments starting with one
at the end of 4 years, to discharge all his
liabilities as to the principal and interest at
7% compounded annually. Find the
annual payment which must be made for

6 years.
A. P66,204.14
B. P65,701.67
C. P67,901.34
D. P68,900.12
702. Two years ago, the rental for the use

of equipment and facilities as paid 5 years
in advance, with option to renew the rent
for another years by payment of P15,000
annually at the start of each year for the
renewal period. Now, the lessor asks the
lessee if it could be possible to prepay the
rental that will be paid annually in 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 %?
704. The quantity of a certain commodity

that is offered for sale at a certain price at
a given place and time.
A. Demand
B. Supply
C. Stocks
D. Goods
705. Work-in process is classified as:
A. An asset
B. A liability
C. An expenses
D. An owners equity
706. What is the highest position in the

corporation?
A. P51,843.90
A. President
B. P51,346.58
B. Board of Directors
C. P52,002.45
C. Chairman of the Board
D. P52,740.20
D. Stockholders
703. NSN Builders plans to construct an

additional building at the end of 10 years
for an estimated cost of P5,000,000.00.
To accumulate the amount, it will have
equal year end deposits in a fund earning
13%. However, at the end of the 5th year,
it was decided to have a larger building
that originally intended to an estimated
cost of P8,000,000.00. What should be
the annual deposit for the last 5 years?
A. P734,391.48
B. P742,890.10
C. P738,900.45
D. P740,010.86
707. Type of ownership in business where

individuals exercise and enjoy the right in
their own interest.
A. Equitable
B. Public
C. Private
D. Pure
708. Decrease in the value of a physical

property due to the passage of time.
A. Inflation
B. Depletion
C. Recession
D. Depreciation

individuals for the purpose of operating a
business as co-owners for profit.

market.
B. Oligopoly
B. Company
C. Monopoly
C. Partnership
D. Elastic demand
D. Corporation
710. We may classify an interest rate,

which specifies the actual rate of interest
on the principal for one year as:
A. Nominal rate
B. Rate of return
C. Exact interest rate
D. Effective rate


are desired by human and will be
required necessities have been obtained.
A. Utilities
B. Necessities
C. Luxuries
D. Products, goods and

services

activities, that will be purchased in
somewhat the same quantity even though
the price varies considerably.
A. Discount
B. Luxury
C. Necessity
A. Utilities
D. Utility
B. Necessities
C. Luxuries
D. Products, goods and

services
712. It is the amount which a willing buyer

will pay to a willing seller for a property
A. Fair value
B. Market value
C. Book value
D. Salvage value
716. A condition where only few

individuals produce a certain product and
that any action of one will lead to almost
the same action of the others.
A. Oligopoly
B. Semi-monopoly
C. Monopoly
A. Physical life
B. Economic life
C. Operating life
D. All of the above
717. Grand total of the assets and

operational capability of a corporation.
A. Authorized capital
B. Investment
C. Subscribed capital
D. Money market
718. The worth of the property equals to

the original cost less depreciation.
A. Scrap value
B. Face value
C. Market value
D. Book value
719. Money paid for the use of borrowed

capital.
A. Discount
B. Credit
C. Interest
D. Profit
720. Liquid assets such as cash, and

other assets that can be converted quickly
into cash, such as accounts receivable
and merchandise are called:
A. Total assets
B. Fixed assets
C. Current assets
D. None of the above
721. The length of time which the property

may be considered at a profit.
722. The provision in the contract that

indicates the possible adjustment of
material cost and labor cost.
726. Those funds that are required to

make the enterprise or project a going
concern.
A. Initial investment
B. Current accounts
C. Working capital
D. Subscribed capital
A. Secondary cause
B. Escalatory clause
C. Contingency clause
A. Monopoly
D. Main clause
B. Monopsony
C. Oligopoly
D. Oligopsony
723. The present worth of all depreciation

over the economic life of the item is called
727. A market situation where there is

only one seller with many buyer.
A. Book value
B. Capital recovery
C. Depreciation recovery
A. Oligopoly
D. Sinking fund
B. Oligopsony
C. Bilateral oligopoly
D. Bilateral oligopsony
724. Gross profit, sales less cost of goods

sold, as a percentage of sales is called:
728. A market situation where there are

few sellers and few buyers.
A. Profit margin
B. Gross margin
C. Net income
A. Monopoly
D. Rate of return
B. Monopsony
C. Bilateral monopoly
D. Bilateral monopsony
725. Worth of the property as shown in

the accounting records of an enterprise.
729. A market situation where there is one

seller and one buyer.
A. Fair value
B. Market value
C. Salvage value
A. Duopoly
D. Book value
B. Oligopoly
730. A market situation where there are

only two buyers with many sellers.
C. Duopsony
D. Oligopsony
731. The cumulative effect of elapsed

time on the money value of an event,
based on the earning power of equivalent
invested funds capital should or will learn.
D. P3,490.09
735. Miss Marcial deposited P1,000,

P1,500 and P2,000 at the end of the
per annum. How much is in the account at
the end of the 4th year?
A. Present worth factor
A. P4,880.00
B. Interest rate
B. P4,820.00
C. Time value of money
C. P4,860.00
D. Yield
D. P4,840.00
732. Defined as the future value minus

the present value.
A. Interest
B. Rate of return
C. Discount
D. Capital
733. The flow back of profit plus

depreciation from a given project is called:
A. Capital recovery
B. Cash flow
C. Economic return
D. Earning value
734. An investment consisting of deposits

of P1,000, P1,500 and P2,000 are made
at the end of the 2nd year, 3rd year and
4th year, respectively. If money is worth
10%, what is the equivalent present worth
of the investment?
A. P3,129.89
B. P3,319.45
C. P3,372.12
736. Miss Santos deposited P1,000,

P1,500 and P2,000 at the end of the
per annum. What is the equivalent
uniform deposit for the uniform gradient
only?
A. P670.81
B. P690.58
C. P660.53
D. P680.12

years, P4,500 on the second year, P4,000
on the third year and P3,500 on the fourth
year. What is the equivalent present worth
of the debt if interest is 5%?
A. P15,093.28
B. P15,178.34
C. P15,890.12
D. P15,389.82


year. Determine future amount of the
amortization if interest is 5%.
A. P18,030.56
B. P18,290.12
C. P18,621.89
D. P18,449.37

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
740. An NBA Basketball superstar, playing

for Los Angeles Lakers is earning an
average annual salary of $5,000,000 for
10 years. Chicago Bulls ball club would
like to acquire his services as a
replacement of the retired Michael Jordan,
offered him an initial annual salary of
$3,000,000 but is increasing at the rate of
$400,000 annually. If he can still play in
the NBA for 10 years and money is worth
10%, which one is true?
741. John Grisham, author of the bestselling novel The Chamber sold its
copyright to Warner Bros. for the rights to
make it into a motion picture. Mr.
Grishams has options between the
following Warner Bros. proposals:
A. An immediate lump sum payment of
$5,000,000.
B. An initial payment of $2,500,000 plus
4% of the movies gross receipts for the
next 5 years which is forecasted as
follows:
End of year
Gross receipt
$10,000,000.00
$8,000,000.00
$6,000,000.00
$4,000,000.00
$2,000,000.00
If money is worth 10% and Mr. Grisham

will not receive any royalty after the fifth
year of exhibition of the movie, by how
much is proposal A bigger than proposal
B?
A. Chicago Bulls offer is

smaller than that of LA Lakers
B. Chicago Bulls offer is

exactly the same as LA Lakers
C. Chicago Bulls offer is just

few dollars more per year than
that of LA Lakers
A. P1,532,630
B. P1,390,090
D. Chicago Bulls offer is over

$150,000 per year than that of
LA Lakers
C. P1,478,100
D. P1,289,450
742. Two sisters, Joan and Jocelyn

decided to save money in funds that
earns 14% compounded annually but on
different ways. Joan decided to save by
making an end-of-year deposit of P1,000
on the first year, P1,100 on the second
year, P1,210 on the third year and so on
increasing the next years deposit by 10%
of the deposit in the preceding year until
the end of the 10th year. Jocelyn decided
to save by just making an equal deposit of
P1,400 annually for 10 years. Who has
more savings at the end of 10 years and
by how much bigger compared to the
other sister?
A. Jocelyn, P671.18
B. Jocelyn, P763.27
C. Joan, P671.18
D. Joan, P763.27
743. Engr. Maragat, believing that life

begins at 40, decided to retire and start
enjoying life at age 40. He wishes to have
upon his retirement the sum of
P5,000,000. On his 21st birthday, he
deposited a certain amount and increased
his deposit by 15% each year until he will
be 40. If the money is deposited in a
super savings account which earns 15%
interest compounded annually, how much
was his initial deposit?
A. P17,253.18
B. P17,566.33
C. P17,672.77
D. P17,490.21
744. A newly-acquired equipment requires

an annual maintenance costs of P10,000.
If the annual maintenance cost is
increased by 20% each year every year
for 10 years, what is the estimated

present worth of the maintenance costs if
money is worth 15%?
A. P105,712.33
B. P106,101.37
C. P107,490.12
D. P108,890.11

of obligations to financial contributors or
claims of other based on profit.
A. Economic return
B. Yield
C. Earning value
D. Expected yield
746. The payment for the use of borrowed

money is called:
A. Interest
B. Interest rate
C. Investment
D. All of the above
749. The true value of interest rate

computed by equations for compound
interest for a 1 year period is known as:
A. Expected return
B. Interest
C. Nominal interest
D. Effective interest
750. The intangible item of value from the

exclusive right of a company to provide a
specific product or service in a stated
region of the country.
A. Market value
B. Book value
C. Goodwill value
D. Franchise value
A. Loan
B. Maturity value
C. Interest
D. Principal
747. The interest rate at which the present

work of the cash flow on a project is zero
of the interest earned by an investment.
751. The recorded current value of an

asset is known as:
A. Scrap value
B. Salvage value
A. Effective rate
C. Book value
B. Nominal rate
D. Present worth
C. Rate of return
D. Yield
748. The ratio of the interest payment to

the principal for a given unit of time and
usually expressed as a percentage of the
principal.
752. Scrap value of an asset is

sometimes known as:
A. Book value
B. Salvage value
C. Replacement value
D. Future value
753. What is sometimes called secondhand value?
A. Scrap value
B. Salvage value
C. Book value
D. Going value
754. An intangible value which is actually

operating concern has due to its
operation.
A. Book value
B. Fair value
C. Goodwill value
D. Going value
755. 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 required for
redemption the firm established a sinking
fund consisting of annual deposits, the
interest rate of the fund being 4%. What
was the principal in the fund at the end of
the 12th year?
A. P37,002.54
B. P37,520.34
C. P38,010.23
D. P38,782.34
756. A local firm is establishing a sinking

fund for the purpose of accumulating a
sufficient capital to retire its outstanding
bonds at maturity. The bonds are
redeemable in 10 years and their maturity
value is P150,000.00. How much should
be deposited each year if the fund pays
interest at the rate of 3%?
A. P13,084.58
B. P13,048.85
C. P13,408.58
A. 3.56%
D. P13,480.58
B. 3.85%
C. 3.75%
D. 3.68%
757. A P1,000,000 issue of 3%, 15-year

bond was sold at 95%. What is the rate of
interest of this investment?
A. 3.0%
B. 3.4%
C. 3.7%
D. 4.0%
758. A man was offered a Land Bank

certificate with a face value of P100,000
which is bearing interest of 6% per year
payable semiannually and due in 6 years.
If he wants to earn 8% semiannually, how
much must he pay the certificate?
years. What is the net rate of interest on

your investment?
761. A P1,000, 6% bond pays dividend

semiannually and will be redeemed at
110% on June 21, 2004. It is bought on
June 21, 2001 to yield 4% interest. Find
the price of the bond.
A. P1,122.70
B. P1,144.81
C. P1,133.78
D. P1,155.06
762. The value which a disinterested third

party, different from the buyer and seller,
will determine in order to establish a price
acceptable to both parties.
A. P90,123.09
B. P90,614.93
C. P90,590.12
A. Market value
D. P90,333.25
B. Goodwill value
C. Fair value
D. Franchise value
759. A P1,000 bond which will mature in

10 years 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.
A. 7.56%
B. 7.65%
C. 7.75%
D. 7.86%
760. You purchase a bond at P5,100. The

bond pays P200 per year. It is
redeemable for P5,050 at the end of 10
763. A type of annuity where the

payments are made at the end of each
payment period starting from the first
period.
A. Ordinary annuity
B. Annuity due
C. Deferred annuity
D. Perpetuity

occurring at equal intervals of time where
the first payment is made after several
periods, after the beginning of the
payment.
768. A mathematical expression also

known as the present value of an annuity
of 1 is called
772. A VOM has a selling price of P400. If

its selling price is expected to decline at a
rate of 10% per annum due to
obsolescence, what will be its selling price
after 5 years?
A. Load factor
A. Deferred annuity
B. Demand factor
A. P222.67
B. Delayed annuity
C. Sinking fund factor
B. P212.90
C. Progressive annuity
D. Present worth factor
C. P236.20
D. Simple annuity
D. P231.56
765. A type of annuity where the

payments are made at the start of each
period, beginning from the first period.
A. Ordinary annuity
B. Annuity due
C. Deferred annuity
D. Perpetuity
766. Which is NOT an essential element

of an ordinary annuity?

payments are equal.
at the beginning of each
period.
767. A is a periodic payment and I is the

interest rate, then present worth of a
perpetuity =
769. As applied to a capitalized asset, the

distribution of the initial cost by a periodic
the reduction of a debt by either periodic
or irregular prearranged program is called
773. A machine costs P8,000 and an

estimated life of 10 years with a salvage
value of P500. What is its book value after
8 years using straight line method?
A. Annuity
B. Capital recovery
C. Annuity factor
D. Amortization
770. The reduction of the value of an

asset due to constant use and passage of
time.
A. Scrap value
B. Depletion
C. Depreciation
D. Book value
771. A method of computing depreciation

in which the annual charge is a fixed
percentage of the depreciated book value
at the beginning of the year which the
depreciation applies.
A. Ai
B. Ain
C. An/i
C. SYD method
D. A/i
A. P2,000.00
B. P2,100.00
C. P2,200.00
D. P2,300.00
774. A telephone company purchased a

microwave radio equipment for P6 million,
freight and installation charges amounted
to 4% of the purchased price. If the
equipment will be depreciated over a
period of 10 years with a salvage value of
8%, determine the depreciation cost
during the 5th year using SYD.
A. P626,269.09
B. P623,209.09
C. P625,129.09
D. P624,069.89
775. ABC Corporation makes it a policy

that for any new equipment purchased,
the annual depreciation cost should not
exceed 20% of the first cost at any time
with no salvage value. Determine the
length of service life necessary if the
depreciation used is the SYD method.
A. 7 years
B. 8 years
C. 9 years
D. 10 years
776. A company purchases an asset for

P10,000.00 and plans to keep it for 20
years. If the salvage value is zero at the
end of the 20th year, what is the
depreciation in the third year? Use SYD
method.
A. P857.14
B. P862.19
C. P871.11
D. P880.00

P500,000.00. The salvage value in 25
years is P100,000.00. What is the total
depreciation in the first three years using
straight-line method?
A. P45,000.00
B. P46,000.00
C. P47,000.00
D. P48,000.00

P50,000 and a salvage value of P10,000
after 10 years. What is the book value
after 5 years using straight line
depreciation?
A. P30,000.00
B. P31,000.00
C. P30,500.00
D. P31,500.00

Its 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.
A. P7,545.45
B. P7,320.11
C. P7,490.00
D. P7,690.12
780. The cost of equipment is P500,000

and the cost of installation is P30,000. If
the salvage value is 10% of the cost of
equipment at the end of years, determine
the book value at the end of the fourth
year. Use straight-line method.
A. P146,320.50
B. P146,000.00
C. P146,230.50
D. P146,023.50

P20,000.00. Its estimated life is 10 years
Find the depreciation for the first year
using SYD method.
A. P1,545.45
B. P1,454.54
C. P1,344.21
D. P1,245.45

P50,000 and a salvage value of P10,000
after 10 years. Find the book value after 5
years using straight-line depreciation.
A. P31,000.00
B. P31,500.00
C. P30,000.00
D. P30,500.00

P10,000.00 after 10 years. What is the
straight line method depreciation rate as a
percentage of the initial cost?
A. 10%
B. 8%
C. 7%
D. 9%

estimated to have a book value of P4,350
when retired at the end of 6 years.
Depreciation cost is computed using a
constant percentage of the declining book
value. What is the annual rate of
depreciation in %?
A. 32.50%
B. 32.25%
C. 32.00%
D. 32.75%

P120,000.00. Its estimated life is 10
years, after which it will be sold for
P12,000.00. Find the depreciation for the
second year using the sum-of-years digit
method.
P40,545.73 when retired at the end of 10

years. Depreciation cost is computed
using a constant percentage of the
declining book value. What is the annual
rate of depreciation in %?
20 years. Find the appraisal value of the

mill using straight line depreciation at the
end of 10 years.
A. P75,500.00
A. P234,000.00
B. P76,000.00
B. P235,000.00
A. 25%
B. 26%
C. P76,500.00
C. P234,500.00
C. 27%
D. P77,000.00
D. P235,500.00
D. 28%

years using straight line method.
790. The initial cost of a paint sand mill,

including its installation, is P800,000. The
BIR approved life of this machine is 10
years for depreciation. The estimated
salvage value of the mill is P50,000 and
the cost of dismantling is estimated to be
P15,000. Using straight-line depreciation,
what is the book value of the machine at
the end of six years?
A. P2,400.00
B. P2,412.34
A. P341,000.00
C. P2,250.00
B. P343,000.00
D. P2,450.00
C. P340,000.00
D. P342,000.00

P500,000. He spent an additional amount
of P30,000 for installation and other
expenses. The estimated useful life of the
equipment is 10 years. The salvage value
is x% of the first cost. Using the straight
line method of depreciation, the book
value at the end of 5 years will be
P291,500. What is the value of x?
791. 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 by straight-line method.
A. 18.89%
B. 19.21%
A. 0.2
C. 19.58%
B. 0.4
D. 19.89%
A. P17,578.13
C. 0.3
B. P17,412.43
D. 0.1
C. P17,344.67
D. P17,672.73

estimated to have a book value of
the cost of dismantling is estimated to be

P15,000. Using straight-line depreciation,
what is the annual depreciation charge?
789. The initial cost of a paint sand mill,

including its installation, is P800,000. The
BIR approved life of this machine is 10
years for depreciation. The estimated
salvage value of the mill is P50,000 and
792. A tax and duty free importation of a

30 hp 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. Other incidental expenses
amount to P20,000.00. Salvage value of
the mill is estimated to be P60,000 after
793. An equipment costs P10,000 with a

salvage value of P500 at the end of 10
years. Calculate the annual depreciation
cost by sinking-fund method at 4%
interest.
A. P791.26
B. P792.61
C. P726.17
D. P771.26
794. A machine initially worth P50,000

depreciates in value each year by 20% of
its value at the beginning of that year.
Find its book value when it is 9 years old.
A. P6,710.89
B. P6,400.89
C. P6,666.89
D. P6,512.78
795. A consortium of international

telecommunications companies
contracted for the purchase and
installation of fiber optic cable linking
Manila City and Cebu City at a total cost
of P960 million. This amount includes
freight and installation charges estimated
at 10% of the above total contract price. If
the cable shall be depreciated over a
period of 15 years with zero salvage value
and money is worth 6% per annum, what
is the annual depreciation charge?
A. P41,044,903.40
B. P41,211,158.40
C. P41,254,000.40
D. P41,244,253.40

years using sum-of-years digit method.
A. P3,279.27
B. P3,927.27
C. P3,729.27
D. P3,792.72
797. 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
798. Shell Philippines, a multinational

company, has a total gross income for a
particular year of P50,000,000. The
taxable income after taking all deductions
except for depletion is P18,500,000. What
is the allowable depletion allowance for
that particular year? Take percentage of
gross income for oil as 22%.
A. P9,358.41
B. P9,228.45
C. P9,250.00
D. P9,308.45
799. The Saudi Arabian Oil Refinery

developed an oil well which is estimated
to contain 5,000,000 barrels of oil at an
initial cost of $50,000,000. What is the
depletion charge during the year where it
produces half-million barrels of oil? Use
Unit or Factor method in computing
depletion.
A. $500,000,000
B. $510,000,000
C. $525,000,000
D. $550,000,000
800. The first cost of a certain equipment

is P324,000 and a salvage value of
P50,000 at the end of its life of 4 years. If
money is worth 6% compounded annually,
find the capitalized cost.
A. P540,090.34
B. P541,033.66
C. P540,589.12
D. P541,320.99
801. An item is purchased for P100,000.

Annual cost is P18,000. Using interest
rate of 8%, what is the capitalized cost of
perpetual service?
A. P310,000
B. P315,000
C. P320,000
D. P325,000
802. A corporation uses a type of motor

which costs P5,000 with 2 life years and
final salvage value of P800. How much
could the corporation afford to pay for
another type of motor of the same

purpose whose life is 3 years a with a final
salvage value of P1,000. Money is worth
4%.
A. P7,892.13
B. P7,157.40
C. P7,489.21
D. P7,300.12
803. A motorcycle costs P50,000 and has

an expected life of 10 years. The salvage
value is estimated to be P2,000 and
annual operating cost is estimated at
P1,000. What is the appropriate rate of
return on the investment if the annual
revenue is P10,000?
A. 12.12%
B. 12.54%
C. 12.72%
D. 12.99%
804. At 6%, find the capitalized cost of a

bridge whose cost is P250M and life is 20
years, if the bridge must be partially
rebuilt at a cost of P100M at the end of
each 20 years.
A. P323,500.33
B. P322,549.33
C. P332,509.33
D. P341,240.33
806. A man planned of building a house.

The cost of construction is P500,000 while
annual maintenance cost is estimated at
P10,000. If the interest rate is 6%, what is
the capitalized cost of the house?
D. P553,540.57
809. A manufacturer produces certain

items at a labor cost per unit of P315,
material cost per unit is P100, variable
cost of P3.00 each. If the item has a
selling price of P995, how many units
must be manufactured each month for the
manufacturer to breakeven if the monthly
overhead is P461,600?
A. 782
B. 800
A. P666,000.00
B. P666,666.67
C. 806
C. P633,333.33
D. 812
D. P650,000.00
807. An untreated electrical wooden pole

that will last 10 years under a certain soil
condition, costs P1,200.00. If a treated
pole will last for 20 years, what is the
maximum justifiable amount that can be
paid for the treated pole, if the maximum
return on investment is 12%. Consider
annual taxes and insurance amount to be
1% of the first cost.
A. P1,612.01
B. P1,559.50
A. P297,308,323.10
C. P1,789.23
B. P298,308,323.10
D. P1,409.38
C. P296,308,323.10
D. P295,308,323.10
805. A new broiler was installed by a

textile plant at a total cost of P300,000
and projected to have a useful life of 15
years. At the end of its useful life, it is
estimated to have a salvage value of
P30,000. Determine its capitalized cost if
interest is 18% compounded annually.
808. A granite quarry purchased for

P1,600,000 is expected to be exhausted
at the end of 4 years. If the resale value of
the land is P100,000, what annual income
is required to yield an investment rate of
12%? Use a sinking fund rate of 3%.
810. The annual maintenance cost of a

machine shop is P69,994. If the cost of
making a forging is P56 per unit and its
selling price is P135 per forged unit, find
the number of units to be forged to breakeven.
812. Steel drum manufacturer incurs a

yearly fixed operating cost of $200,000.
Each drum manufactured cost $160 to
produce and sells $200. What is the
manufacturers break-even sales volume
in drums per year?
A. 5,031
B. 5,017
C. 5,043
D. 5,000
813. XYZ Corporation manufactures

bookcases that sell for P65.00 each. It
costs XYZ corporation 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 P50.00, how
many cases must be sold each year for
XYZ to avoid taking a loss?
A. 2,334
A. 892
B. 2,443
B. 870
C. 2,223
C. 886
D. 2,322
D. 862
811. A manufacturer produces certain

items at a labor cost of P115 each,
material cost of P76 each and variable
cost of P2.32 each. If the item has a unit
price of P600, how many units must be
manufactured each month for the
manufacturer to break even if the monthly
overhead is P428,000.
814. A company which manufactures

electric motors has a production capacity
of 200 motors a month. The variable costs
are P150.00 per motor. The average
selling price of the motors is P275.00.
Fixed costs of the company amount to
P20,000 per month which includes taxes.
Find the number of motors that must be
sold each month to breakeven.
A. 1,033
A. 160
B. 1,037
B. 157
A. P550,540.57
C. 1,043
C. 153
B. P551,540.57
D. 1,053
D. 163
C. P552,540.57
815. The annual maintenance cost of a

machine is P70,000. If the cost of making
a forging is P56 and its selling price is
P125 per forged unit. Find the number of
units to be forged to breakeven.
A. 1,000
B. 1,012
C. 1,015
D. 1,018

the demand?
A. 1.0 hours per unit
B. 1.2 hours per unit
C. 1.4 hours per unit
D. 1.6 hours per unit
817. Compute the number of blocks that

an ice plant must be able to sell per
month to break even based on the
following data:
Cost of electricity per block - P20.00
Tax to be paid per block - P2.00
Real Estate Tax - P3,500.00 per month
Salaries and Wages - P25,000.00 per
month
Others - P12,000.00 per month
Selling price of ice - P55.00 per block
A. 1,220
B. 1,224
C. 1,228
D. 1,302
818. JRT Industries manufactures

automatic voltage regulators at a labor
cost of P85.00 per unit and material cost
of P350.00 per unit. The fixed charges on
the business are P15,000 per month and
the variable costs are P20.00 per unit. If
the automatic voltage regulators are sold
to retailers at P580.00 each, how many
units must be produced and sold per
month to breakeven?
A. 120
B. 124
C. 128
D. 130
819. General Electric Company which

manufactures electric motor has a
capacity of producing 150 motors a
month. The variable costs are P4,000.00
per month, the average selling price of the
motor is P750.00 per motor. Fixed costs
of the company amount to P78,000.00 per
month which includes all taxes. Determine
the number of motors to be produced per
month to breakeven.
A. 100
B. 104
C. 110
D. 112
820. A telephone switchboard 100 pair

cable can be made up with either
enamelled wire or tinned wire. There will
be 400 soldered connections. The cost of
soldering a connection on the enamelled
wire will be P1.65, on the tinned wire, it

will be P1.15. A 100-pair cable made up
with enamelled wire cost P0.55 per linear
foot and those made up of tinned wire
cost P0.75 per linear foot. Determine the
length of cable run in feet so that the cost
of each installation would be the same.
A. 1,000 feet
B. 1,040 feet
C. 1,100 feet
D. 1,120 feet
821. A local factory assembling

calculators produces 400 units per month
and sells them at P1,800 each. Dividends
are 8% on the 8,000 shares with par value
of P250 each. The fixed operating cost
per month is P25,000. Other costs are
P1,000 per unit. If 200 units were
produced a month, determine the profit or
loss.
A. Profit of P121,666.67
B. Profit of P21,666.67
C. Loss of P121,666.67
D. Loss of P21,666.67
822. Nike shoes manufacturer produces a

pair of Air Jordan Shoes at a labor cost of
P900.00 a pair and a material cost of
P800.00 a pair. The fixed charges on the
business are P5,000,000 a month and the
variable costs 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, how many pairs must be produced
each month for the manufacturer to
breakeven?
A. 2,590
B. 2,632
C. 2,712
D. 2,890
823. In a steel fabrication shop located

somewhere in Cebu, various size rivet
holes must be made in structural
members. This may be done by laying out
the position of the hole on the members
and using a drill press for this method, a
machinist wage rate is P20.25 per hour
and he can drill 27 holes per hour. An
alternative method is by the use of the
multiple punch machine. In this process,
the machinist wage rate is P20.00 per
hour and he can complete 8 holes per
minute. This method requires P0.50 per
holes to set the multiple punch machine
and an installation cost of P2,000.00. If all
other costs are the same, for what
number of rivet holes will the multiple
punch machine pay for itself?
A. 9,601
B. 9,592
C. 9,581
D. 9,566
824. A new civil engineer produces a

certain construction material at a labor
cost of P16.20 per piece, 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 P95.00 each,
how many pieces must be manufactured
in each month to breakeven?
A. 3,045
B. 3,035
C. 3,030
D. 3,040
825. The Asian Transmission Co. makes

and sells certain automotive parts.
Present sales volume is 500,000 units per
year at a selling price of fifty centavos

(P0.50) per unit. Fixed expenses total
P80,000.00 per year. What is the present
total profit for a year?
A. P168,000
B. P170,000
C. P172,000
D. P174,000
826. The Asian Transmission Co. makes

and sells certain automotive parts.
Present sales volume is 500,000 units per
year at a selling price of fifty centavos
(P0.50) per unit. Fixed expenses total
P80,000.00 per year. What is the present
breakeven point in units?
A. 160,000
B. 162,000
C. 165,000
D. 170,000
827. A factory engaged in the fabrication

of an automobile part with a production
capacity of 700,000 units per year is only
operating at 62% of capacity due to
unavailability of the necessary foreign
currency to finance the importation of their
raw materials. The annual income is
P430,000.00. Annual fixed costs are
P190,000.00 and the variable costs are
P0.348 per unit. What is the current profit
or loss?
A. P87,450
B. P88,960
C. P88,450
D. P87,960
828. A factory engaged in the fabrication

of an automobile part with a production
capacity of 700,000 units per year is only

operating at 62% of capacity due to
unavailability of the necessary foreign
currency to finance the importation of their
raw materials. The annual income is
P430,000.00. Annual fixed costs are
P190,000.00 and the variable costs are
P0.348 per unit. What is the breakeven
point?
831. A small shop in Bulacan fabricates

threshers for palay producers in the
locality. The shop can produce each
thresher at a labor cost of P1,800.00. The
cost of materials for each unit is
P2,500.00. The variable costs amounts to
P650.00 per unit while fixed charges
incurred per annum totals P69,000.00. If
the portable threshers are sold at
P7,800.00 per unit, how many units must
be produced and sold per annum to
breakeven?
A. 294,560
B. 291,000
C. 290,780
A. 28
D. 295,490
B. 25
C. 26
D. 27
829. A certain firm has the capacity to

produce 650,000 units of product per
year. At present, it is operating at 62%
capacity. The firms annual income is
P4,160,000.00. Annual fixed costs are
P1,920,000.00 and the variable costs are
equal to P3.56 per unit of product. What is
the firms annual profit or loss?
A. P814,320
B. P815,230
832. The direct labor cost and material

cost of a certain product are P300 and
P400 per unit, respectively. Fixed charges
are P100,000 per month and other
variable costs are P100 per unit. If the
product is sold at P1,200 per unit, how
many units must be produced and sold to
breakeven?
C. P816,567
D. P817,239
B. 250
C. 260
D. 270
830. A certain firm has the capacity to

produce 650,000 units of product per
year. At present, it is operating at 62%
capacity. The firms annual income is
P4,160,000.00. Annual fixed costs are
P1,920,000.00 and the variable costs are
equal to P3.56 per unit of product. What
volume of sales does the firm breakeven?
A. 280
833. The following data for year 2000 are

available for Cagayan Automotive
Company which manufactures and sells a
single automotive product line:
Unit selling price - P40.00
A. P3,354,680
B. P3,534,880
Unit variable cost - P20.00
C. P3,155,690
Unit contribution margin - P20.00
D. P3,254,680
Total fixed costs - P200,000.00
What is the breakeven point in units for

the current year?
A. 10,000
B. 10,100
C. 10,050
D. 10,200
834. The cost of producing a small

transistor radio set consists of P230.00 for
labor and P370.00 for material. The fixed
charges is operating 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
many sets must be produced per month to
breakeven.
C. P25,121
B. Present worth factor
D. P25,132
C. Capacity factor
D. Demand factor

the amount to recover is spread uniformly
over the estimated life of the asset in
terms of the periods or units of output.
A. The original purchase price

and freight and transportation
charges
B. Installation expenses
D. SYD method
C. Initial taxes and permits fee
D. All of the above
837. Which of the following depreciation

methods cannot have a salvage value of
zero?
A. 7,123
A. Declining balance method
B. 7,133
C. 7,143
D. 7,153
D. SYD method
835. An item which can be sold for P63.00

per unit wholesale is being produced with
the following cost data:
Labor cost - P10.00 per unit
Material cost - P15.00 per unit
Fixed charges - P10,000.00
838. A method of depreciation where a

estimated life.
Variable cost - P8.00 per unit
What is the breakeven point sales volume

if one out of every 10 units produced is
defective and is rejected with only full
recovery on materials?
D. SYD method
A. P25,011
B. P25,111
839. The function of interest rate and time

that determines the cumulative amount of
a sinking fund resulting from specific
periodic deposits.
840. The first cost of any property

includes:
A. Sinking fund factor
841. In SYD method, the sum of years

digit is calculated using which formula
with n = number of useful years of the
equipment.
A. n(n 1)/2
B. n(n + 1)/2
C. n(n+1)
D. n(n-1)
842. Capitalized cost of any property is

equal to the:
A. Annual cost
B. First cost + Interest of the

first cost
C. First cost + Cost of

perpetual maintenance
D. First cost + Salvage value
843. The lessening of the value of an

asset due to the decrease in the quantity
available (referring to the natural
resources, coal, oil, etc).
A. Depreciation
B. Depletion
C. Inflation
D. Incremental cost
B. Corporation
C. Enterprise
D. Partnership
844. Is the simplest form of business

organization.
B. Partnership
C. Enterprise
D. Corporation

persons for a purpose of engaging in a
profitable business.
B. Enterprise
C. Partnership
D. Corporation
846. A distinct legal entity which can

practically transact any business
transaction which a real person could do.
B. Enterprise
C. Partnership
849. What is the minimum number of

incorporators in order that a corporation
be organized?
A. 3
B. 5
C. 10
D. 7
850. In case of bankruptcy of a

partnership,
D. Corporation
847. Double taxation is a disadvantage of

which business organization?
B. Partnership
C. Corporation
D. Enterprise
848. Which is NOT a type of business

organization?
A. The partners are not liable

for the liabilities of the
partnership
B. The partnership assets
(excluding the partners
personal assets) only will be
used to pay the liabilities.
C. The partners personal
assets are attached to the debt
of the partnership
D. The partners may sell stock
to generate additional capital.
851. The method of depreciation where

estimated life is known as;
852. The term used to express the series

of uniform payments occurring at equal
interval of time is;
A. compound interest
B. annuity
C. perpetuity
D. depreciation

of obligations to financial contributors and
claims of others based on profit is known
as;
A. yield
B. earning value
C. economic return
D. expected yield
854. As applied to capitalized asset, the

distribution of the initial cost by periodic
the reduction of the depth by either
periodic or irregular prearranged program
is called
D. principal or present worth
856. These are product or services that

are desired by humans and will be
required necessities have been obtained
B. monopoly
C. oligopoly
D. elastic demand
860. It is the amount that a willing buyer

will pay to a willing seller for a property
A. utilities
B. necessities
C. luxuries
A. fair value
D. producer good and services
B. use value
C. market value
D. book value
857. These are product or services that

activities, that will be purchased in
somewhat the same quantity even though
the price varies considerably.

A. utilities
A. discount
B. necessities
B. luxuries
C. luxuries
C. utility
D. producers goods and

services
D. necessity
858. A condition where only a few

individuals produce a certain product and
that any action of one will lead to almost
the same action of the others.
862. A form a summary of assets,

liabilities and net worth;
A. balance method
B. break-even point
A. amortization
A. oligopoly
C. balance sheet
B. annuity
B. semi-monopoly
D. production
C. depreciation
C. monopoly
D. capital recovery
D. perfect competition
855. Those funds that are required to

make the enterprise or project going on.
A. straight line method
A. banking
B. SYD method
B. accumulated amount
C. working capital

market.
A. perfect competition
863. The worth of a property, which is

equal to the original cost less
depreciation, is known as;
A. earning value
B. scrap value
C. book value
D. face value
864. When using net present worth

calculation to compare two projects, which
of the following could invalidated the
calculations?
868. The amount received from the sale

of an additional unit of a product is termed
as:
A. marginal cost
B. marginal utility
A. mutually exclusive projects
B. evaluation over different

periods
C. marginal unit
C. non-conventional cash flows
D. marginal revenue
D. difference in the magnitude

of the projects
865. Which of the following is a form of

business/company ownership?
869. An accounting book where the

original record of all transaction is
ordinarily recorded.
A. journal
A. partnership
B. credit entry
B. corporation
C. debit entry
C. single proprietorship
D. transaction record
D. all of these
866. What must two investments with the

same present worth and unequal lives
have?
870. An interest-earning fund in which

equal deposits are made at equal
intervals of time for the purpose of
gradually accumulating a specific sum of
money required at some future date.
A. identical salvage value
A. amortization
B. different salvage value
B. sinking fund
C. identical equivalent uniform

annual cash flows
C. annuity
D. different equivalent annual

cash flows
D. capitalized cost
867. What is the formula for a straight-line

depreciation rate?
A. (100% - %net salvage

value)/Estimated service life
B. %net salvage
value/Estimated service life
C. 100%net salvage
value/estimated service life
D. average net salvage
value/estimated service life
871. What is work-in-process classified

as?
A. an asset
B. liability
C. an expense
D. owner's equity
872. Which is a form of

business/company ownership?
A. partnership
B. Profit
A. Break-even price
B. corporation
C. Credit
B. Equilibrium price
C. single proprietorship
D. Debit
C. Minimum price
D. all of the list
D. Maximum price
873. The decrease in value of a physical

property due to the passage of time;
877. The act of charging two or more

buyers or sellers different prices for the
same product where the elasticities of
supply or demand at each price level
differ among market is known as:
A. inflation
B. depletion
A. Price optimization
C. recession
B. Price discrimination
D. depreciation
C. Price manipulation
D. Price war
874. We may classify an interest rate,

which specifies the actual rate an interest
on the principal for one year as:

within an industry forming a perfect
collision purposely formed to increase
profit and block newcomers from the
industry, is termed as;
881. The length of time during which a

property is capable of performing the
function for which it was designed and
manufactured is termed as;
A. economic life
B. Life span
C. Eternal life
D. Physical life
882. It is a distinct legal entity, separate

from individuals who own it and which can
engage in practically any business
transaction which real person can do.
A. Nominal rate
B. Rate of return
C. Exact interest rate
A. Oligopoly
A. Partnership
D. Effective rate
B. Monopoly
B. Single proprietorship
C. Corporation
C. Eternal Life
D. Cartel
D. Physical life
875. This law states that When the use of

one of the factors of production is limited,
either in increasing cost or by absolute
quantity, a point will be reached beyond
which an increase in the variable factors
will result in less than proportionate
increase in output.
A. Law of Supply and Demand
B. Law of Diminishing Return
C. Law of Gravity
D. Law of diminishing Utility

worth and the worth at some future time
is:
A. Discount
879. A situation in which rival firms drive

prices down through attempts to undercut
each others price is called;

buyer of an item for which there are no
goods substitute.
A. Price war
A. Monopoly
B. Price discrimination price
B. Oligopoly
C. Price Leadership
C. Oligopsony
D. Oligopolistic monopoly
D. Monopsony
880. The price that the quantity per unit

time that the buyers want to buy is just
equal to the quantity the sellers want to
sell is called;
884. This form of business ownership is a

legal entity possessing many of the legal
powers of individuals. It can hold title to
property, sue and be sued in its own
name. It is called:
A. corporation
B. company
C. general partnership
D. individual proprietorship
885. The balance sheet is a statement

showing the financial status of the
company at any given time. Which of the
statements is not a part of the balance
sheet.
A. liabilities
B. assets
C. cost of goods sold
D. net worth
886. Refers to cost of merchandise which

excludes freight and insurance cost;
D. assets
889. The worth of property which is equal

to the original cost less depreciation;
A. scrap value
B. earning value
C. book value
D. face value
890. Intangible assets of a corporation or

company
A. A series of equal payments

at equal time periods.
B. The cost of manufacturing a

product
C. An investment that yields an

equal amount of interest each
year
D. The overhead cost per unit
of production
894. Consist of the actual counting or

determination of the actual quantity of the
materials on hands as of a given date;
A. dacion-en-pago
B. investment
B. Technological assessment
C. patents
C. Material update
D. equity
D. Material count
891. Additional information to prospective

bidders on contract documents issued to
bidding date;
895. An artificial expense that spreads the

purchase price of an assets or other
property over a number of years
A. freight-on-board
B. sunk cost
C. debentures
A. escalatory clause
A. Depreciation amnesty
D. book value
B. delicts
B. Sinking fund
C. technological assessments
C. Bond
D. bid bulletin
887. A fund into which annual deposits

of A are made in order to accumulate
fund F at n years in the future.
892. A civil wrong committed by one

person causing damage to another
person or his property or reputation;
A. Amortization
B. Annuity
C. Depreciation
A. tort
D. Sinking fund
B. negligence
888. Cash money credit necessary to

establish and operate an enterprise.
C. material breach
D. fraud
A. funds
B. capital
C. liabilities
893. What is an annuity?
896. Estimated value at the end of the

useful life;
B. book value
C. Cash flow
C. salvage value
D. present worth
898. The ratio of the interest payment to

the principal for a given unit of time and is
usually expressed as percentage of the
principal is known as:
B. Exact
C. Both A and B
B. nominal interest
C. interest
D. interest rate

the amount to recover is spread over the
estimated life of the asset in terms of the
periods or units of output is called
A. SOYD method
B. Declining balance method
900. The interest rate at which the present

worth of cash flow of project is zero, or the
interest earned by an investment.
903. The interest earned by the principal

competed at the end of the investment
period, it varies directly with time.
A. Compound interest
B. Simple interest
C. Annuity
D. Perpetuity
904. The interest is completed every end

of each interest period and the interest
earned for the period is added to the
principal.
A. Compound interest
B. Simple interest
A. Rate of return
C. Annuity
B. Effective rate
D. Perpetuity
C. Nominal rate
B. economic life
D. Yield
C. balance sheet
D. compounded annually
A. scrap value
A. Ordinary
A. investment
A. salvage value
897. The recorded current value of an

asset is known as:
902. Which of the following is a type of

simple interest;
901. It is the amount of money earned by

given capital.
A. Interest
B. Annuity
905. It is rate quoted in describing a given

variety of compound interest.
A. nominal rate
B. effective rate
C. simple rate
D. compound rate
906. It is the actual interest earned in one

year period.
A. Nominal rate
B. Effective rate
C. Simple rate
D. Compound rate
907. A series of uniform payments made

at equal intervals of time.
A. perpetuity
B. interest
C. rate
D. annuity
908. Which of the following is type of

annuity.
A. Ordinary
B. Deferred
C. Annuity due
D. All of the above
909. An annuity where the payments

periods extend forever or the periodic
payments continue indefinitely.
A. Perpetuity
B. Interest
C. Rate
D. Annuity
910. The payment is made at the end of

each period starting from the first period.
A. Ordinary annuity
B. Deferred annuity
C. Annuity due
A. Straight line depreciation
A. Bond
A. P 20,234.87
D. All of the above
B. Capital
B. P 19,222.67
C. Sum of the years method
C. Interest
C. P 24,429.97
D. All of the above.
D. Annuity
D. P 28,456.23
911. The first payment is deferred a

certain number of periods after the first.
916. The most common method used in

computing depreciation;
920. A method of determining when cost

exactly equal to revenue.
924. What is the principal amount if the

amount of interest at the end of 2 1/2 year
is P4,500.00 for a simple interest of 6%
per annum?
A. Ordinary annuity
B. Deferred annuity
C. Annuity due
A. Experimental method
B. Break-even method
A. P 35,000.00
C. Sum of the years digit

method
C. Break-add method
B. P 30,000.00
C. P 40,000.00
D. P 45,000.00
912. The payment is made at the

beginning of each period starting from the
first period.
A. Ordinary annuity
B. Deferred annuity
C. Annuity due
D. None of the due
913. It is an application of perpetuity.
A. Capitalized cost
B. Machine cost
C. Manpower cost
D. Equipment cost
914. It refers to the decrease in the value

of an asset due to usage of passage of
time.
A. Interest
B. Annuity
C. Depreciation
D. Perpetuity
915. Which of the following is the method

of computing depreciation
917. The depreciation charge in this

method is assumed to vary directly to the
number of years and inversely to the sum
of the years digit.
921. Find the interest on P6,800.00 for 3

years at 11% simple interest.
A. P 1,875.00
925. How long must a P40,000 note

bearing 4% simple interest run to amount
to P41,350.00?
B. P 1,987.00
C. P 2,144.00
A. 340days
D. P 2,244.00
B. 403 days

method
C. 304 days
D. 430 days
918. It is invested yearly at a rate of I to

amount to (FC SV) at the end of the life
to the property.
922. A man borrowed P10,000.00 from his

friend and agrees to pay at the end of 90
days under 8% simple interest rate. What
is the required amount?
A. P 10,200.00
B. P 11,500.00
C. P 9,500.00
D. P 10,700.00

method
919. A written contract to pay a certain

redemption value on a specified
redemption date and to pay equal
dividends periodically.
923. Annie buys a television set from a

merchant who offers P25,000.00 at the
end of 60days. Annie wished to pay
immediately and the merchant offers to
compute the required amount on the
assumption that the money is worth 14%
simple interest. What is the required
amount?
926. If P16,000 earns P480 in 9monnths,

what is the annual rate of interest?
A. 1%
B. 2%
C. 3%
D. 4%
927. A man lends P6,000 at 6% simple

interest for 4 years. At the end of this time
he invest the entire amount (principal plus
interest)at 5% compounded annually for
12 years. How much will he have at the
end of the 16-year period.?
A. P 13,361.20
B. P 13,633.20
C. P10,345.80
C. P13,333.20
D. P11,040.20
D. P16,323.20
928, A time deposit of P110,000 for

31days earns P890.39 on maturity date
after deducting the 20% withholding tax
on interest income. Find interest per
annum.
A. 12.5%
B. 11.95%
C. 12.25%
D. 11.75%
929. A bank charges 12% simple interest

on a P300.00 loan. How much will be
repaid if the loan is paid back in one lump
sum after three years.
A. P 408.00
B. P 551.00
C. P415.00
D. P450.00
930. A tag price of a certain commodity is

for 100 days. If paid in 31 days, there is
3%discount. What is the simple interest
paid?
932. Accumulate P5,000.00 for 10 years

at 8% compounded semi-annually.
A. P 10,955.61
B. P 10,233.67
C. P9,455.67
D. P11,876.34

at 8% compounded monthly
C. 13 years
D. 14 years
937. If the compound interest on

P3,000.00 in years is P500.00 then the
compound interest on P3,000.00 in 4
years is:
B. P 1,083.00
B. P 11,102.61
C. P1,125.00
C. P10,955.61
D. P1,526.00
D. P10,955.61

at 8% compounded annually.
938. The salary of Mr. Cruz is increased

by 30%every 2 years beginning January
1, 1982. Counting from that date, at what
year will his salary just exceed twice his
original salary?
940. What is the effective rate for an

interest rate at 12% compounded
continuously?
B. P 8,567.97
C. P10,987.90
D. P7,876.87
935. How long it will take P1,000 to

amount to P1,346 if invested at 6%
C. 22.32%
A. 3 years
D. 16.14%
B. 4 years
C. 5 years
D. 6 years
936. How long will it take for an

investment to double its amount if
944. 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. 12.01%
B. 12.89%
C. 12.42%
A. 4.55 years
D. 12.75%
B. 4.77 years
C. 5.11 years
D. 5.33 years
Answer: D
941. How long it will take for an
investment to fivefold its amount if money
is worth 14%compounded semiannually.
945. 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. 11
B. 12
C. 13
A. P 178,313.69
D. 14
B. P 153,349.77
C. P 170,149.77
D. P 175,343.77
942. An interest of 8% compounded

semiannually is how many percent if
A. P 10,794.62
B. P 13,876.50
B. 12 years
B. 6.25%
A. P 15,456.75
A. P 12,456.20
A. 10 years
A. P 956.00
A. 12.5%

at 8% compounded quarterly.
invested at an interest rate of 6%

compounded bi-monthly
946. What interest compounded monthly

is equivalent to an interest rate of 14%
compounded quarterly
A. 1988
A. 7.81%
B. 1989
B. 7.85%
C. 1990
C. 7.92%
A. 1.15%
D. 1991
D. 8.01%
B. 13.84%
C. 10.03%
D. 11.52%
939. If you borrowed P10,000 from the

bank with 18% interest per annum, what
is the total amount to be repaid at the end
of one year.
943. 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?
947. What is the worth of two P100,000

payments at the end of the third and the
fourth year? The annual interest rate is
8%.
A. P 11,800.00
A. P 125,458.36
B. P 19,000.00
B. P 147,456.36
C. P28,000.00
C. P162,455.63
A. P 152.87
D. P10,180.00
D. P171,744.44
B. P 112.34
C. P 187.98
D. P 176.67
948. A firm borrows P2,000.00 for 6years

at 8%. At the end of 6 years, it renews the
due?
How much money in the form of interest

will he get if the money is put in a bank
that offers 8% rate compounded annually
at the end of 7 years?
A. P 34,276.48
B. P 34,270.00
A. P 5,679.67
C. P 36,276.40
B. P 6,789.98
D. P 34,266.68
C. P 6,034.66
D. P 5,888.77
949. At an annual rate of return of 8%,

what is the future worth ofP1,000 at the
end of 4 years?
A. P 1,388.90
B. P 1,234.56
C. P 1,765.56
D. P 1,360.50
950. A student has money given by his

grandfather in the amount of P20,000.00.
1. 21 %
2. 6.65 %
3. 29.17 %
4. 12 months
5. 25.0 %
6. 5,937.50
7. 10.29 %
8. 4.00 %
9. 16.28 %
10. 11.75 %
11. 12.07 %
12. P18,000
13. 13.73 %
14. 3.90 %
15. P39.45
16. 9.14 %
17. 19.72 %
18. 8.24 %
19. 11.60 %
compounded
annually
20. 12.00 %
21. 14.2 years
22. 11.57 years
23. P705.42
24. Quarterly
25. P1,549.64
26. P54.66
27. P 152.88
28. P 3,260.34
29. P 15,030.03
30. P 19,624.49
31. P 717.17
32. P 1,185.54
33. P 2,504.57
34. P 7,731.29
35. P 43,763.20
36. P 143,999.08
37. P 6,922.93
38. P 4,860.00
39. 3.0%
40. P 1,144.81
41. P 236.20
42. P 2,000.00
43. 9 years
44. P 3,927.27
45. P 9,250.00
46. $ 5,000,000.00
47. 1,053
48. 1.0 hour per unit
49. 1,000 feet
50. 2,632
51. Economic
Analysis
52. Foreign exchange
53. Goods or
commodities
54. Services
55. Consumer and
producer
56. Necessity
57. Necessity
58. Market
59. Buyer or
consumer
60. Producer
61. Monopsony
62. Bilateral oligopoly
63. Bilateral
monopoly
64. Perfect
competition
65. Monopoly
66. Oligopsony
67. Few sellers and
many buyers
68. Many sellers and
few buyers
69. Few sellers and
many buyers
70. Atomistic
competition
71. Perfect
competition
72. All of the above

73. Monopoly
74. the single vendor
can prevent the entry
of all other vendors in
the market
75. Natural monopoly
76. Law of
diminishing return
77. Demand
78. Supply
79. Law of supply
and demand
80. Commodity
81. Simple interest
82. 360
83. 360
84. Time value of
money
85. Discount
86. Earning value
87. Interest
88. Interest rate
89. Compound
interest
90. Rate of interest
91. Annuity
92. Annuity certain
93. Ordinary annuity
94. Annuity due
95. Perpetuity
96. Deferred annuity
97. The first payment
is made at the
beginning of the first
period.
98. Bond
99. Value of bond
100. Bond
101. Coupon
102. Joint bond
103. Equipment
obligation bond
104. Coupon bond
105. Mortgage bond
106. Debenture bond
107. Collateral trust
bond
108. Registered bond
109. Callable bond
110. Callability
111. Call value
112. Depreciation
113. A. Straight line
method
114. Sinking fund
method
115. Declining
balance method
116.
117. Constant
percentage method
118. Functional
depreciation
119. Physical
depreciation
120. Adolescence
121. Depletion
122. Unit method and
percentage method
123. Fixed
percentage of gross
income or 50% of the
net taxable income
124. Percentage
method
125. Factor method
126. Initial cost of
property times
number of unit sold
during the year
divided by the total

units in property
127. Depreciation
recovery
128. Present worth
factor
129. Market value
130. Second-hand
value
131. Fair value
132. Franchise value
133. In-place value
135. Valuation
136. Sunk cost
137. Capitalized cost
138. Life cycle cost
139. Annual cost
method
140. Benefit-cost ratio
141. Opportunity cost
142. The initial

depreciation is low
143. Single payment
present worth
144. Capital recovery
145. Sole
proprietorship
146. Corporation
147. Sole
proprietorship
148. Corporation
149. The partnership
assets (excluding the
partners personal
assets) only will be
used to pay the
liabilities
150. It can be handed
down from one
generation of
partners to another.
151. The stock
holders of the
corporation are only
liable to the extent of
their investments.
152. Corporation
153. Partnership
154. Common stock
155. Preferred stock
156. Dividend
157. Equity
158. Equity
159. Capital
160. Stock
161. Economic return
162. Goodwill
163. Patents
164. Fixed asset
165. Rate of return
166. Liquid assets
167. Cost of goods
sold
168. Incremental cost
169. Bookkeeping
system
170. Ledger
171. Journal
172. Gross income
173. Supervision cost
174. Receivable
turnover
175. Profit margin

ratio
176. Tax credit
177. Rule of 72
178. Capital gain
179. Capital loss
180. Certificate of
deposit
181. Currency
depreciation
182. Currency
devaluation
183. Forced saving
184. Cash flow
185. Amortization
186. First cost + cost
of perpetual
maintenance
187. Effective interest
188. Net income to
owners equity
189. Net sale
190. Quick ratio
191. Consol
192. Cooperative
193. Buffer stock
194. Solvency
195. Liquidity
196. Assets = liability
+ owners equity
198. Current ratio
199. Current assets
to current liabilities
200. Quick ratio
201. Quick ratio
202. Receivables
turnover
203. Net credit sales
to average net
receivables
204. Return of
investment ratio
205. Price-earnings
ratio
206. The ratio of the
net income before
taxes to net sales
207. The ratio of
gross profit to net
sales
208. The ratio of
common
shareholders equity
to the number of
outstanding shares
209. The ratio of cost
of goods sold to
average cost of
inventory on hand
210. 365 / receivable
turnovers
211.Break-even
analysis
212. 365 / inventory
turnover
213. Payback period
214. Value of an
investment
215. Double declining
balance method and
SYD method
216. It is one that
calculates a
depreciation amount
greater than a
straight line amount
217. Deflation
218. Cartel
219. Bank notes
220. Law of
diminishing return
221. Price-earnings
222. Return on
investment
223. Profit margin
224. Arbitrage
225. Moratorium
226. Rate discount
229. Lien
230. Oligopoly
231. Book value
232. Depletion
233. Fair value
234. Franchise
236. Bond
237. Utility value
238. Perfect
competition
239. Annual cost
pattern
240. P 1, 192.57
241. P 224.62
242. P 5, 427.43
243. P 756
244. 8.64 %
245. 7.44 years
246. The first
payment is made at
the beginning of each
period.
247. P4,280.47
248. Straight line
method
249. Declining
balance method
250. Sinking fund
method
251. 37.11%
252. 16.28%
253. 15.92% ;
13.73%
254. 13.64%
255. P18,800
256. P4133.33
257. P5,000
258. 21.4%
259. 32%
260. P1,513.56
261. 11.75
262. P46,729
263. 4% ; 4.17%
264. 66.6%
265. 15.8%
266. P76.92
267. P15,614.59
268. P1403.68
269. P13,498.60
270. 11.57 years
271. P13,265.83
272. P163,475.37
273. P6750
274. 8%
275. 4.55 years
276. P200,000
277. 8%
278. 8.03%
279. 8.28%
280. 14.2 years
281. 5.13%
282. 21.97 years
283. P24,751.34
284. 3.92%
285. 3%
286. 19.72%
287. 12.75%
288. P3.87
289. 21.51%
290. 6%
291. P155
292. P77.66
293. 0.333
294. 6%
295. 7%
296. 1.60844
297. P705.42
298. P256,000
299. P507,365.96
300. P519,327.95
301. 8%
302. 4 years
303. 8%
304. 8%
305. 1.61607
306. 0.616783
307. 8 years
308. 6.25 years
309. 6.18 years
310. 12% ; 12.616% ;

12.06%
311. 16.67 yrs ; 11.6
yrs ; 11.55 yrs
312. P15,000.00
313. P16,550.00
314. P17,492.94
315. 8.00%
316. 8.24%
317. 7.96%
318. 1.612226000
319. 0.787566127
320. 1.487886717
321. 8.33%
322. 1.377128
323. 0.726149
324. 6.00%
325. 6.09%
326. 5.87%
327. 8.00%
328. 8.24%
329. 7.92%
330. P800,000.00
331. P907,009.21
332. P911,059.20
333. P44,086.60
334. 4.56 years
335. 9.5%
336. 11.6%
compounded monthly
337. 7%
338. 8%
339. 8%
340. 5.8%
341. save P55 by
borrowing from your
friend
342. P30,655.68
343. P82938.28
344. 14.49%
345. P71,781.47
346. 19.72%
347. 3.00% and
3.02%
348. 11.83%
349. 19.48%
350. P6,040.20
351. P16,712.03
352. 20.15 years
353. P621,170
354. P690,849
355. 5 years
356. quarterly
357. P120,289.51
358. P15,030.00
359. P18,548.39
360. 16.6%
361. 2.94%
362. 6%
363. 5.66%
364. P291,500
365. P8000
366. P125,000
367. P3,250,000
368. 4 years
369. P50,000
370. 10 years
371. P146,000
372. P900,000
373. P1,200,000
374. P1,185,769.76
375. P2,400
376. P2,670
377. 8%
378. P30,000
379. P33,200
380. P7,545.45
381. P652,333.33
382. P64 M
383. P2,294.44
384. 8 years
385. P857
386. P350
387. 19 years
388. P300,000
389. P679,454.27
390. P21,357.42 ;
P68,642.58
391. P12,420
392. Straight Line
393. Sum of Years
Digit
394. Declining
Balance
395. Double
Declining Balance
396. Sinking Fund
397. P430,629.00
398. P180,000
399. P14,000
400. P15,000
401. Utility
402. Pretend stock
403. Market value
404. Depreciation
405. Oligopoly
406. Monosony
407. Book value
408. Deflation
409. Cartel
410. Monopoly
411. Bilateral
monopoly
412. Deflation
413. Annuity
414. Interest
415. Maker
416. Par value
417. Duopsony
418. Duopoly
420. Break even
421. Sunk cost
422. Gratuitous
423. Construction
cost
424. Marginal
revenue
425. Scrap value
426. Book value
427. Prime cost
428. Discount
429. Marginal cost
430. Bond
431. Salvage value
432. Physical
inventory
433. Current asset
434. Tort
435. Perpetuity
436. Necessities
437. Supply
438. Salvage value
439. Depreciation
440. Partnership
441. Proprietorship
442. Demented
persons
443. Luxury
444. Perfect
competition
445. Luxuries
446. Authorized
capital
447. Journal
448. Economic life
449. Franchise
450. Book value
451. P400.00
452. 12.07%
453. 1 hour
454. 18%
455. P3.80
456. 6.58%
457. P44,750
458. P32,000
459. P4,200
460. 37.5%
461. 26 days
462. P12,000 per
cubic meter
463. 166
464. P860
465. P1,207,500
466. P4.90
467. P949,645
468. 28.33%
469. P829,592.50
470. P1,916,858.24
471. 12 months
472. Processing
method A
473. P630 per engine
474. P473,000
475. 16.67%
476. 25.0%
477. P5,937.50
478. P46,728.97
479. 10.29%
480. P11,800
481. 37.11%
482. 4.00%
483. 4.17%
484. P25,250
485. P28,000
486. 16.28%
487. 11.75%
488. P5,166.67
489. 12.07%
490. 19.05%
491. P4,133.33
492. P18,800
493. P18,348.62
494. 13.64%
495. 15.92%
496. 13.73%
497. P1,233.55
498. 15.69%
499. P666.39
500. 3.90%
501. P8,807.92
502. P39.45
503. P971.83
504. P31,079.73
505. 9.14%
506. P71,781.47
507. P40,530.49
508. 19.72%
509. 16.32%
510. 8.24%
511. 11.83%
512. 11.60%
compounded monthly
513. P3,864.95
514. 12.00%
515. P6,040.20
516. 19.48%
517. P30,655.68
518. 7.86 years
519. P215,344.40
520. 14.2 years
521. 19.64%
522. 14.49%
523. P6,265.87
524. P13,265.83
525. 5 years
526. 5.96%
527. P15,614.59
528. 11.57 years
529. P2,444.32
530. P705.42
531. 3.5%
532. P4,626.12
533. 12.55%
534. Quarterly
535. 10 years
536. P1,549.64
537. P1,494.52
538. P13,498.59
539. P6,716.53
540. P4,631.93
541. P690,848.73
542. 7.71%
543. P54.66
544. P2,158.92
545. 5.84%
546. P621,169.64
547. P152.88
548. 16.67%
549. P3,260.34
550. P18,548.38
551. 17.35%
552. 7.42 years
553. 5 years
554. P15,030.03
555. P7,623.42
556. 20 years
557. P6,209.21
558. P11,025.25
559. P2,000,166.28
560. 4.06%
561. P39,026.25
562. P1,550
563. 1.64 years
564. P27,782.36
565. P15,249.13
566. P5,552.64
567. P593,888.96
568. P18,302.85
569. P19,624.49
570. 42.57%
571. 19.56%
572. P11,025.25
573. 7.42 years
574. P11,717.85
575. 14.27 years
576. P4,838,949.58
577. P77,108.66
578. P2,158.92
579. 41.42%
580. 8.00%
581. 10.00%
582. 5.74%
583. P2,795.00
584. P1,611.51
585. P201,869.91
586. P44,851.64
587. P153,085.56
588. 4.26%
589. 10.11%
590. 9.56%
591. P14,715,068
592. P147,346.02
593. P146,323.08
594. P8,769.18
595. P61,500
596. 6
597. 3.7%
598. 11.55%
599. P2,170,968.95
600. Bank note
601. Deflation
602. Annuity
603. Market
604. Monopsony
606. Break even no
gain no loss
607. Gratuitous
608. Prime cost
609. Acid-test ratio
610. Depreciation
611. Salvage value
612. Physical
inventory
613. Bid bulletin
614. Perpetuity
615. P717.17
616. P17,504.13
617. P1,185.54
618. P2,432.26
619. P8,626.02
620. P2,504.57
621. P42,821.86
622. P7,731.29
623. P40,454.29
624. P1,295.05
625. P5,174.23
626. P43,763.20
627. P10,834.38
628. P143,999.08
629. P12,835.32
630. P716.81
631. 4.61%
632. P37,520.34
633. P808,835.92
634. P30,941.73
635. P242,806.22
636. P12,615.80
637. P1,101.08
638. P6,922.93
639. 32.7%
640. P7,425.72
641. P13,486.70
642. 24.8%
643. P1,263.71
644. P3,942.44
645. P13,486.73
646. P13,023.52
647. P3,702,939.73
648. 5
649. P1,699.86
650. P839.19
651. 2.15
652. P3,573.99
653. P838.86
654. P10,205.13
655. 24%
656. P16,379.75
657. P3,919.52
658. P371,287.13
659. P3,576.64
660. P5,650.22
661. P42,821.87
662. 10
663. P13,994.17
664. P1,827.79
665. P100,375.37
666. P197,008.25
667. P8,225.00
668. P186,927.24
669. P35,074.58
670. P15,185.78
671. 19.47%
672. P7,710.94
673. P34,675.18
674. P135,507.42
675. 478
676. P72,173.90
677. P2,775.50
678. P99,601.71
679. 0.492%
680. 4.5 years
681. P6,917.72
682. P250,000
683. 36.71%
684. P278,664.54
685. P366,062.33
686. 35.28%
687. P233,779.27
688. P347,733.29
689. P217,679.01
690. P2,195,600.03
691. P45.95
692. P2,526,768.61
693. P34,710.74
694. P32,727.27
695. Borrow and buy
is economical by
almost a hundred
thousand than lease.
696. No, it is not a
sound idea
697. P2,782.93
698. P252.12
699. P846.10
700. Foreign
operation yields
approximately 3%
less rate of return
than domestic
operation.
701. P66,204.14
702. P51,346.58
703. P734,391.48
704. Supply
705. An asset
706. Chairman of the
Board
707. Private
708. Depreciation
709. Partnership
710. Effective rate
711. Luxury
712. Market value
713. Perfect
competition
714. Luxuries
715. Necessities
716. Oligopoly
717. Authorized
capital
718. Book value
719. Interest
720. Current assets
721. Economic life
722. Escalatory
clause
723. Depreciation
recovery
724. Gross margin
725. Book value
726. Working capital
727. Monopoly
728. Bilateral
oligopoly
729. Bilateral
monopoly
730. Duopsony
731. Time value of
money
732. Discount
733. Cash flow
734. P3,319.45
735. P4,860.00
736. P690.58
737. P15,178.34
738. P18,449.37
739. P4,280.47
740. Chicago Bulls
offer is over $150,000
per year than that of
LA Lakers
741. P1,532,630
742. Joan, P763.27
743. P17,566.33
744. P106,101.37
745. Economic return

746. Interest
747. Rate of return
748. Interest rate
750. Franchise value
751. Book value
752. Salvage value
753. Salvage value
754. Going value
755. P37,520.34
756. P13,084.58
757. 3.0%
758. P90,614.93
759. 7.56%
760. 3.85%
761. P1,144.81
762. Fair value
765. Annuity due
766. The first
payment is made at
the beginning of each
period.
767. A/i
768. Present worth
factor
769. Amortization
770. Depreciation
771. Declining
balance method
772. P236.20
773. P2,000.00
774. P626,269.09
775. 9 years
776. P857.14
777. P48,000.00
778. P30,000.00
779. P7,545.45
780. P146,000.00
781. P1,454.54
782. P30,000.00
783. 8%
784. 32.25%
785. P17,672.73
786. 25%
787. P2,400.00
788. 0.1
789. P76,500.00
790. P341,000.00
791. 18.89%
792. P235,000.00
793. P791.26
794. P6,710.89
795. P41,244,253.40
796. P3,927.27
797. P99,658.41
798. P9,250.00
799. $500,000,000
800. P541,033.66
801. P325,000
802. P7,157.40
803. 12.72%
804.
P295,308,323.10
805. P322,549.33
806. P666,666.67
807. P1,559.50
808. P550,540.57
809. 800
810. 886
811. 1,053
812. 5,000
813. 2,334
814. 160
815. 1,015
816. 1.0 hours per
unit
817. 1,228
818. 120
819. 110
820. 1,000 feet
821. Profit of
P121,666.67
822. 2,632
823. 9,601
824. 3,040
825. P170,000
826. 160,000
827. P88,960
828. 295,490
829. P814,320
830. P3,354,680
831. 25
832. 250
833. 10,000
834. 7,143
835. P25,011
836. Straight line
method
837. Declining
balance method
838. Sinking fund
method
839. Sinking fund
factor
841. n(n + 1)/2
842. First cost + Cost
of perpetual
maintenance
843. Depletion
844. Sole
proprietorship
845. Partnership
846. Corporation
847. Corporation
848. Enterprise
849. 5
850. The partners
personal assets are
attached to the debt
of the partnership
851. Sinking fund
method
852. annuity
853. economic return
854. amortization
855. working capital
856. luxuries
857. necessities
858. oligopoly
859. perfect
competition
860. market value
861. utility
862. balance sheet
863. book value
864. evaluation over
different periods
865. all of these

866. identical
equivalent uniform
annual cash flows
867. (100% - %net
salvage
value)/Estimated
service life
868. marginal
revenue
869. journal
870. sinking fund
871. an asset
872. all of the list
873. depreciation
874. Effective rate
875. Law of
diminishing Utility
876. Discount
877. Price
discrimination
878. Cartel
879. Price war

880. Equilibrium price
881. Physical life
882. Partnership
883. Monopsony
884. corporation
885. cost of goods
sold
886. book value
887. Sinking fund
888. capital
889. book value
890. patents
891. bid bulletin
892. tort
893. A series of equal
payments at equal
time periods.
894. Physical
inventory
895. Depreciation
amnesty
896. salvage value

897. book value
898. interest rate
899. Straight line
method
900. Rate of return
901. Interest
902. Both A and B
903. Simple interest
904. Compound
interest
905. nominal rate
906. Effective rate
907. annuity
909. Perpetuity
912. Annuity due
914. Depreciation
915. All of the above.
916. Straight line

depreciation
917. Sum of the
years digit method
918. Sinking fund
method
919. Bond
920. Break-even
method
921. P 2,244.00
922. P 10,200.00
923. P 24,429.97
924. P 30,000.00
925. 304 days
926. 4%
927. P 13,361.20
928. 11.75%
929. P 408.00
930. 16.14%
931. P11,040.20
932. P 10,955.61
933. P 11,102.61
934. P 10,794.62
935. 5 years
936. 12 years
937. P 1,083.00
938. 1988
939. P 11,800.00
940. 12.75%
941. 12
942. 7.92%
943. P171,744.44
944. 4.77 years
945. P 170,149.77
946. 13.84%
947. P 152.87
948. P 6,034.66
949. P 1,360.50
950. P 34,276.48

Engineering Economics MCQs Solved

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Engineering Economics MCQs Solved

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Engineering Economics MCQs

1. First Benchmark Publishings gross

electrically operated hydraulic guillotine

2. A farmer selling eggs at 50 pesos a

5. Engr. Trinidad loans from a loan firm an

3. A feasibility study shows that a fixed

6. A loan of P5,000 is made for a period of

8. A college freshman borrowed P2,000

9. It is the practice of almost all banks in

4. The monthly demand for ice cans being

7. Mr. Bacani borrowed money from the

10. A man invested P110,000 for 31 days.

11. A investor wishes to earn 7% on his

12. Mr. Jun Ramos was granted a loan of

15. What is the ordinary interest on

16. A loan for P50,000 is to be paid in 3

13. Miss Evilla borrowed money from a

14. The exact simple interest of P5,000

17. What is the effective rate

18. What rate of interest compounded

19. Which of these gives the lowest

20. An amount of P1,000 becomes

21. How long will it take money to double

22. By the condition of a will, the sum of

principal is withdrawn. The interest has

27. What is the present worth of two P

B. The construction of a smaller building

34. What is the present worth of a year

24. Mandarin Bank advertises 9.5%

28. A firm borrows P2,000 for 6 years at

25. A student plans to deposit P1,500 in

26. You borrow P3,500.00 for one year

29. In year zero, you invest P 10,000.00 in

30. The institute of Electronics and

By how much is proposal B more

31. What is the present worth of a P500

35. A man loans P 187,400 from a bank

32. What annuity is required over 12

33. A factory operator bought a diesel

36. A person buys a piece of lot for P

37. A young engineer borrowed P 10,000

42. A machine costs of P 8,000 and an

39. A P 1,000,000 issue of 3%, 15-year

43. ABC Corporation makes it a policy

40. A P 1, 000, 6% bond pays dividend

B. 1.2 hours per unit

B. Engineering cost analysis

C. 1.4 hours per unit

D. 1.6 hours per unit

D. Design cost analysis

46. The Saudi Arabian Oil Refinery

49. A telephone switchboard 100 pair

53. What is defined as any tangible

47. A manufacturer produces certain items

50. A leading shoe manufacturer produces

45. Shell Philippines, a multinational

52. What is considered as the standard

A. 1.0 hour per unit

44. An asset is purchased for P 9,000.00.

41. A VOM has a selling price of P 400. If

What is the allowable depletion allowance

48. A manufacturing firm maintains one