Podcast
Questions and Answers
A bank charges 12% simple interest on a P300 loan. How much will be paid if the loan is paid back in one lump sum after three years?
A bank charges 12% simple interest on a P300 loan. How much will be paid if the loan is paid back in one lump sum after three years?
F=408 or F=P408.
It is the practice of almost all bank in the Philippines that they grant a loan, the interest for one year is automatically deducted the principal amount upon release of money to a borrower. Let us therefore assume that you applied a loan with a bank and the P80000 was approved at an interest rate of 14% of which P11200 was deducted and you were give a check of P68000. Since you have to pay the amount of P80000 one year after, what then will be the effective interest rate?
It is the practice of almost all bank in the Philippines that they grant a loan, the interest for one year is automatically deducted the principal amount upon release of money to a borrower. Let us therefore assume that you applied a loan with a bank and the P80000 was approved at an interest rate of 14% of which P11200 was deducted and you were give a check of P68000. Since you have to pay the amount of P80000 one year after, what then will be the effective interest rate?
i=16.28%
A man borrowed P500 000 from a bank and agreed to pay the loan at the end of a months. The bank discounted the loan and gave him P450 000 in each. What is the rate of discount?
A man borrowed P500 000 from a bank and agreed to pay the loan at the end of a months. The bank discounted the loan and gave him P450 000 in each. What is the rate of discount?
10%
Determine the exact simple interest on P5500 for the period from January 10,1996 to october 28 1996 at 11% interest.
Determine the exact simple interest on P5500 for the period from January 10,1996 to october 28 1996 at 11% interest.
Signup and view all the answers
The balance sheet
Asset
cash - 10 000
receivables- 12 000
inventory- 7000
capital equipment- 20000
total: 49 000
Liabilities
payables-17 000
notes due- 6 000
long term debt-3000
owner's equity-23 000
total: 49 000
what is the acid test ratio?
The balance sheet
Asset cash - 10 000 receivables- 12 000 inventory- 7000 capital equipment- 20000 total: 49 000
Liabilities payables-17 000 notes due- 6 000 long term debt-3000 owner's equity-23 000 total: 49 000
what is the acid test ratio?
Signup and view all the answers
50 000 is borrowed for 75 days at 16% per annum simple interest. How much will be due at the end of 75 days?
50 000 is borrowed for 75 days at 16% per annum simple interest. How much will be due at the end of 75 days?
Signup and view all the answers
A manufacturing firm maintains one product assembly line to produce signal generators. Weekly demand for generators is 35 units. The line operates for 7 hours per day, 5 days per week . What maximum production time in hours required of the line to meet the demand?
A manufacturing firm maintains one product assembly line to produce signal generators. Weekly demand for generators is 35 units. The line operates for 7 hours per day, 5 days per week . What maximum production time in hours required of the line to meet the demand?
Signup and view all the answers
An investor wishes to invest 40 000 Venture A, requiring 40 000 will return 8% Venture B, requiring 10 000 will return 15%. What return on the remaining 30 000 is required to equal the overall profitability of venture A?
An investor wishes to invest 40 000 Venture A, requiring 40 000 will return 8% Venture B, requiring 10 000 will return 15%. What return on the remaining 30 000 is required to equal the overall profitability of venture A?
Signup and view all the answers
Agnes Abanilla was granted a loan of 20 000 by her employer CPM industrial fabricator & construction & corporation with an interest of 6 percent for 180 days on the principal collected in advance. The corporation would accept a promissory note for 20 000 non interest for 180 days. If discounted at once, find the proceeds on the note.
Agnes Abanilla was granted a loan of 20 000 by her employer CPM industrial fabricator & construction & corporation with an interest of 6 percent for 180 days on the principal collected in advance. The corporation would accept a promissory note for 20 000 non interest for 180 days. If discounted at once, find the proceeds on the note.
Signup and view all the answers
Fred wanted to buy refrigerator which will have a price of 13 000 for 90 days from now due to the increase in prices of 12 percent simple interest. what is the present worth of refrigerator?
Fred wanted to buy refrigerator which will have a price of 13 000 for 90 days from now due to the increase in prices of 12 percent simple interest. what is the present worth of refrigerator?
Signup and view all the answers
Study Notes
Simple Interest Loan Calculations
- A P300 loan with 12% simple interest for 3 years will have a total amount of P396 due at the end of the term.
- The interest for the loan is P36, calculated by multiplying the principal amount (P300) by the interest rate (12%) and the number of years (3).
- Total amount due is the principal amount (Php300) plus the interest (Php36) for a total of Php396.
Effective Interest Rate Calculation
- An 80000 loan with a 14% interest rate results in an effective interest rate of 16.47%.
- The initial interest deduction of 11200 leaves the borrower with 68,800 usable funds.
- The 16.47% effective interest rate is calculated by dividing the total interest amount (11,200) by the usable funds (68,800).
Bank Discount Rate Calculation
- A bank loan of P500,000 with a discount of P50,000 results in a discount rate of 10%.
- The discount of P50000 is calculated by subtracting the amount received by the borrower (P450,000) from the original loan amount (P500,000).
- The discount rate is calculated by dividing the discount (P50,000) by the original loan amount (P500,000) and multiplying by 100.
Simple Interest Calculation with Specific Dates
- The exact simple interest earned on P5,500 for the period from January 10, 1996, to October 28, 1996, at an 11% interest rate is P186.14.
- The calculation is based on the actual number of days between the two dates.
- The simple interest is calculated by multiplying the principal (P5500), the interest rate (11%), and the fraction of the year represented by the period.
Acid Test Ratio
- The Acid Test Ratio for a company with P10,000 in cash, P12,000 in receivables, and P17,000 in current liabilities is 1.35.
- This ratio measures a company's ability to meet its short-term debt obligations.
- It is calculated by dividing the sum of cash and receivables by current liabilities.
Simple Interest Calculation for Specific Period
- A loan of P50,000 for 75 days at 16% per annum simple interest will have a total of P5208.33 due at the end of 75 days.
- The simple interest is calculated by multiplying the principal (P50,000), the interest rate (16%), and the fraction of the year represented by 75 days.
Production Time Calculation
- An assembly line producing 35 units per week with 7 hours of operation per day for 5 days needs a maximum production time of 1 hour to meet the demand. This means that the whole production process must be done in one hour to effectively meet the demand.
Portfolio Return Rate Calculation
- An investor with P40,000 to invest desires a return equal to Venture A (8%). They have allocated P40,000 to Venture A (8% return) and P10,000 to Venture B (15% return).
- To achieve an overall return rate of 8%, the remaining P30,000 must be invested to generate an 8% return.
Discounted Note Calculation
- A loan of P20,000 with 6% interest for 180 days, collected in advance, will have a proceeds of P19,400 on the note.
- The discount is calculated by multiplying the principal, the interest rate, and the fraction of the year represented by 180 days.
- This discount is then deducted from the principal to arrive at the proceeds.
Present Worth Calculation
- A refrigerator costing P13,000 in 90 days with a 12% simple interest rate has a present worth of P12,106.
- This calculation involves discounting the future value of the refrigerator back to its present worth.
- The calculation is based on the future price, the interest rate, and the time period.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
This quiz tests your understanding of simple interest calculations using a practical example involving a P300 loan. You will need to determine the total amount to be repaid after three years at a 12% interest rate. Sharpen your financial literacy skills by solving this problem!
