1. A store manager plans to exchange his old computer
how
at the end of 5 years for a newer one worth P150,000.
The trade-in value of the old computer at that time is
estimated to be P5,000. If money can be invested at
10% compounded quarterly, how much must the
manager invest at the end of each quarter in order to
make the exchange?
2. Shang and Gellie wants to accumulate P100,000 each
in 10 years for a trip to Paris. If Shang’s bank is paying
8% interest compounded quarterly and Gellie’s bank
is paying 12% compounded semi-annually, how much
must Shang and Gellie deposit at the beginning of
each payment to save up for the trip?
3. A debt is being repaid by semi-annual payments of
P50,000 for a period of 9 years with interest at 12%
compounded semi-annually. Find the original amount
borrowed.
4. A payment of P2,000 is made every end of the quarter
for three years at 12% compounded monthly. A) Find
its future value. B) Find its present value.
5. If you want to withdraw P10,000 annually at an
interest rate of 5% for an indefinite period of time,
how much should you deposit today?
6. A company wants to set up a sinking fund for the
repayment of a loan of 100million at the end of 2
year. It makes equal deposits at the end of each
quarter into a fund that earns interest at 22% per
year compounded quarterly. Determine the size of
each deposit and construct a sinking fund schedule.
7. A loan of P50,000 with interest rate of 15%
compounded annually is to be repaid after five years.
Find the quarterly deposit to be set up to be able to
pay the obligation in 5 years.
8. Savannah purchased a MacBook for P80,000 on May
13, 2009. She paid P10,000 cash and agreed to pay
the balance plus interest at 9 ½ % compounded
annually in 14 annual payments, with the first
payment due on May 13, 2012. What is the size of
each payment?
9. M&M’s recently purchased a new equipment for
P679,000. What amortization payment is required
each year, at 16% interest, to pay off the obligation
at the end of 11 years?
10. A woman wants to have P100,000 at the end of 3
years in order to start a garment business. To realize
this she will create a sinking fund by making equal
deposits at the end of each 6 months. If the fund
earns interest at 8% interest compounded monthly,
a. how much is the semi-annual deposit? B.
much is the fund after 4th deposit?
11. If P20,000 semi-annual payments were made at the
end of 3 years for 15 times, what is the value today
if the interest rate is 10%?
12. Shaira wants to save up enough money to shop for
clothes worth of P120,000 with monthly payment of
10% interest. How much money should she deposit
each month into an account?
13. Find the present value of 10 quarterly payments of
P25,00 each made at the beginning of every quarter,
the first payment if made at the lapse of 1 year.
Interest rate is 6%.
14. How much must a man invest at the end of every 3
months for 1 year in a fund that earns 10% interest
compounded semi-annually to accumulate P120,000?
15. Maricriz deposits P500 every beginning of the month
for 4 years in orders to prepare for her review classes
for the CPA Board Exam after graduation. What is the
(a) future value and (b) present value of the fund if
the interesy rate is 8% compounded quarterly?
16. Drew financed a P99,000 engagement ring for his
wife, Iya. If he will be making 30 monthly payments
of P2,340, what rate of financing did he receive?
17. A man needs to repay a loan of P300,000 after 4
years. To provide this money he will make annual
deposits in a sinking fund at the beginning of cash
period that earns 7.5% interest monthly.
18. An P80,000 loan with interest at 15% compounded
semi-annually is to be amortized at P23,000 every
end quarters and a final smaller payment. Compute
for the loan balance after the 3rd payment.
19. If P500,000 is deposited today and you want to
receive a monthly return for an indefinite period of
time, how much should you withdraw every month if
the interest rate is 1% per month?
20. Kuya bought an iPhone worth of P36,725 and made
a down payment of 5,000. How much must he deposit
at the beginning of each quart in order to amortize
the debt within one year?
21. What are the (a) future value and (b) present value
of 30 annual payments of P1,500 made, with the first
payment at the end of 2 years from the present time
with interest at 10% compounded semi-annually?
22. How much should be set aside today to provide
annual withdrawal income of P12,000 for 5 years if
 the first one is to be made at the end of seven years
and the effective interest rate is 8%?
23. A loan of P50,000 is to be repaid by 4 installment
made at the beginning of every six months, at 10%
interest compounded quarterly. Compute for the
periodic payment.
24. Find the present value of a perpetuity of P300 payable
quarterly if interest is 15% compounded annually,
and (a) the first payment is due three months from
now. What if (b) the first payment is due now?
25. A debt of P450,000, whose quarterly interest rate is
4%, must be repaid in 7 years. To discharge the debt,
quarterly deposits are made into a sinking fun which
earns interest rate at the rate of 12% compounded
quarterly. What is the quarterly expense of the debt?
26. A sinking fund is created by depositing P5,000 for a
period of 9 years every end of the year at 10%
compounded annually. A. How much will be in the
fund after the 25th deposit? B. how much is the fund
increase on the 15th deposit date?
27. What is the future value of 10 quarterly payments of
P100,000 each made at the end of each quarter when
the first payment is made at the end of two quarters
if money is worth 8%.
28. Ferrari Company is offering loans of brand new
models cars at 8% interest. What monthly payments
would be required to amortize a Ferrari of
P18,765,000 for 13 years?
29. What is the present value of a P7,600 perpetuity
payable at the beginning of each quarter if money is
worth 14% compounded quarterly?
30. A sinking fund is established by Asus at 15% interest
compounded bimonthly to meet a financial obligation
of P20,000,000 in 8 years. (a) What periodic sinking
fund payment is required every two months to reach
the company’s goal? (b) How much greater would the
payment be if the interest rate was 12% compounded
semi-annually, rather than 15%?
31. A debt is being repaid by semi-annual payments of
P50,000 for a period of 9 years with interest at 12%
compounded annually. Find the original amount
borrowed.
32. A P67,000 is to repaid at the beginning of each one
year. The debtor establishes a sinking fund that earns
9% interest compounded quarterly.
Referring above, assume that the interest rate on the
sinking fund was 7% compounded quarterly during
the first ½ year and 10% compounded quarterly
during the second ½ year.
33. If money is worth 5 ½ % compounded annually, what
single payment now is equivalent to 45 annual
payments of P35,000 each with the first payment due
in five years?
34. Find the accumulated value of an annuity of P5,000
invested at the beginning of every six months for 3
years at 7% compounded annually.
35. A debt of P75,000 is to be amortized with 12,000
being paid quarterly. The interest rate is 16%
compounded quarterly.
Referring above, assume that the interest rate on the
amortization was 12% compounded quarterly during
first 4 year and 10% compounded quarterly during
the remaining years.
36. A loan of P50,000 with interest rate of 15%
compounded quarterly is to be repaid with quarterly
payment after five years. Find the quarterly payment.
37. Solve for the E of an annuity of P500 payable at the
end of each quarter for 5 years if the interest rate is
7% compounded semi-annually.
38. At the birth of a child, the father wants to deposit a
certain sum in a trust fund to provide his child P5,000
every month for 4 years, starting on his 12th birthday.
If the fund grows at the rate of 9% compounded
monthly, how much should the father deposit?
39. A loam of P500,000 with interest rate of 12%
compounded monthly is to be repaid after 5 years.
Find the quarterly payments to be able to pay the
obligation on 5 years.
40. A woman wants to have P100,000 at the end of 3
years in order to start a garment business. To realize
this she will create a sinking fund by making equal
deposits at the end of each 6 months. If the fund
earns interest at 8% interest compounded semi-
annually, A. how much is the semi-annual deposit? B.
how much is the fund after 4th deposit? C. how much
is the interest at the 5th period?
41. What is the present value of a P7,600 perpetuity
payable at the end of each quarter if money is worth
14% compounded quarterly?
42. Bellamy borrowed P65,000 at 7% interest
compounded quarterly and agreed to repay the loan
in quarterly payments of P5,000 each. The first
 payment is due on two years. Find the number of
payments.
43. Polka wishes to accumulate P1,300,000 at the end of
10 years, to retire bonds outstanding. How much
should the company deposit monthly if it will earn
interest of 10% compounded quarterly for 5 years
and invest the money to another investment paying
12% interest compounded annually for another 5
years.
44. Jagedorn wants to have P200,000 at the end of 3
years in order to start a car calibration business. To
realize this he will create a sinking fund by making
equal deposits at the end of each 6 months. If the
fund earns interest at 15% interest compounded
monthly, how much is the semi-annual deposit?
45. A loan of P50,000 is to be repaid by 4 installment
made at the beginning of every six months, at 10%
interest rate. Construct an amortization schedule.
46. What sum, when invested a 8.25% compounded
annually will provide payments of P14,000 at the end
of each year forever?
47. How much must a man invest at the end of every 3
months for 1 year in a fund that earns 10% to
accumulate P120,000? Construct a sinking fund
schedule.
48. A sequence of semi-annual payments will begin now
and will continue forever. Find the size of the
semiannual payments if the present value of the
perpetuity is P35,000 and money is worth 14%.
49. At 2% interest per quarter, what will be the present
value of the simple perpetuity if payment of P3,500 is
made at the beginning of each quarter?
50. A sinking fund is created by depositing P5,000 every
end of the year at 10% compounded monthly. How
much will be in the fund after the 25th deposit?
51. Dave has P200, 000 at the end of the 2 years in his
savings account. The interest rate is 15%
compounded semi-annually. How much did he
deposited yearly in the account 2 years ago?
52. A debt is paid with P5,675 at the end of the quarter
for 7 years. How much is the outstanding principal
after the 24th payment?
53. You want to buy a brand new Ferrari. You have
enough cash to pay the P200,000 cash prize of the
item. However, you have the option of paying it
through installments of P9,200 at the end of every
month for 2 years. If money is worth 9%
compounded annually, should you pay the cash prize
or choose installment payments? Support your
answer with a solution.
54. John plans to exchanged his old computer at that end
of 5 years for a newer one worth P100,000. The trade
in value of the old computer at that time is estimated
to be P2,000. If money can be invested at 7%
compounded quarterly, how much must the manager
invest at the end of each year in order to accumulate
money for the exchange?
55. Morgy is offering mortgages at 5% interest. What
monthly beginning payments would be required to
amortize a loan of P3,400,000 for 13 years?
56. Merc invests P10,000 now at an interest rate of 10%
compounded semi-annually and wants to draw
interest at the end of each year forvere. How much
interest will she receive annually?
57. Suppose you need to buy a car, but you don't have
enough money to fully pay for one. The only way you
can buy one is to take out a car loan. Given the
amount of the car is P1,256,000 with annual interest
rate of 10% payable for 13 years. What annual
amount must be deposited to afford the car?
58. Bridgit needs a monthly allowance of P10,00. She
proposed to her parents to just deposit an amount in
the bank which will meet her needs for the next 3
years of her college life so that they would not be
burdened anymore to keep sending her money. How
much must be deposited at the beginning of each
quarter if their family savings bank offers a 9%
interest, compounded monthly?
59. A man needs to repay a loan of P300,000 after 4
years. To provide this money he will make annual
deposits in a sinking fund at the beginning of cash
period that earns 7.5% interest. Construct a sinking
fund schedule.
60. An P80,000 loan with interest at 15% compounded
semi-annually is to be amortized at P23,000 every
end quarters and a final smaller payment. Construct
an amortization schedule.
61. Ms. Khween wants to invest P1,000 every end of the
month as her savings for 2 years. However, she is
doubting as to which bank she should invest her
money. SanaTotoo Bank offers 12.5% interest
compounded quarterly. WishKoLang Bank offers 13%
compounded annually. As an investment Mathematic
student, where would you advise Ms. Khween to
invest her money?
62. A CPA saves 5% of her monthly income of P20,000 at
the end of each year during a two-year period. How
much will the investment be worth two years after the
last investment is made if the interest rate is 6%
compounded monthly?

63. How much must a man invest at the end of every 3

months for 1 year in a fund that earns 10% interest
compounded semi-annually to accumulate P50,000?

64. A CPA saves 5% of her monthly income of P20,000 at

the end of each year during a two-year period. How
much will the investment be worth two years after the
last investment is made if the interest rate is 6%
compounded monthly?
65. A P40,000 debt is to repaid at the end of 1 ½ years.
Interest charged is 15% payable at the end of every
3 months. The debtor established a sinking fund that
earns 12% interest compounded quarterly. (a) Find
the interest payment on the debt for each 3-month
period. (b) Construct a sinking fund schedule.

66. Find the future value and present value of an annuity

of P100 payable at the end of quarter for 10 years if
the interest rate is 7% compounded monthly.

67. A television set amounted for P18,000. As an

incentive, the store manager offers to accept P1,500
to be paid at the beginning of every month for one
year with no finance charge. If money is worth 12%
compounded quarterly, what is the actual cost of the
television?

68. Find the amount of each payment that must be made

into a sinking fund to accumulate
each amount bimonthly. 6500; money earns 8%
compounded annually; 6 annual payments

69. A man needs to repay a loan of P150,000 after 2

years. To provide this money he will make deposits in
a sinking fund at the beginning of every quarter that
earns 12% interest monthly.

70. CCA issued P15,980,000 worth of bonds to raise fund

to build a new building and improve it. What semi-
annual deposits must be made into a sinking fun
earning interest at 8% compounded semi-annually in
order to accumulate the fund at the end of 5 years?