1. Terms of sales: ₱90,000 payable on a monthly 16.

The Continental Printing

payable in 120 days or basis? The first payment Press is considering
₱85,500 payable in 45 will be due at the end of buying a new die-cut
days. Find the the first month. machine which costs ₱
equivalent annual rate 10. Suppose that a fixed 80 000. The machine
of simple interest if paid sum of money, A, will be has a useful life of 20
in 120 days. deposited in a savings years with a salvage
2. A cigarette vendor account at the end of value of ₱ 20 000. The
borrowed ₱2400 and each year for 20 years. annual operating costs
agreed to pay ₱3000 If the bank pays 6% per are equal to ₱ 18 000:
after 30 days. What is year, compounded The die-cut machine will
the simple interest rate annually, find A such produce an annual
per annum? that a total of $50,000 savings in material of ₱
3. A college graduate will be accumulated at 25 711. Find the rate of
wishes to borrow the end of the 20-year return if the machine is
P20,000 in order to period. installed.
start his own business. 11. What is the difference 17. A new machine which
A bank will lend him the between the sums of an cost ₱50,000 has a life
money provided he annuity due and an of 5 years. It is
agrees to repay P920 ordinary annuity for the expected to generate
per month for two following data? ₱25,000 in revenues in
years. How much Periodic Payment = each year of its life with
interest is he being ₱150,000 an annual operating
charged? Terms = 20 years cost of ₱8,280. compute
4. If the interest rate is Payment Interval = 1 the rate of return so
10% per year, year that it’s not present
compounded annually. Interest Rate = 12% value (NVL) would be
What is the minimum compounded annually equal to zero.
amount of money that 12. An endowment of 18. The first cost of a
would have to be P10000 will start now machine is Php.
invested for a two-year and continues every 3 1,800,000 with a
period in order to earn months interval for 8 salvage value of Php.
P300 in interest? years. If money is worth 300,000 at the end of
5. How long would it take 5% compounded its life of 5 years.
for a businessman to quarterly, find the sum Determine the total
double his money if the of the annuity at the depreciation after 3
rate of interest per year end of the 8th year. years using Straight
is 10%, compounded 13. What is the equivalent Line Method.
annually? uniform annual cost 19. A building has a salvage
6. Determine the nominal (EUAC) if the interest value of ₱1,000,000
interest rate rate is 10% per year; after 50 years. Annual
corresponding to an compounded annually? depreciation is
effective interest rate of 14. A contractor can buy a ₱2,000,000. Using the
10% per year, dump truck for Straight-line Method of
compounded P800,000 each (surplus) Depreciation, how many
continuously. or rent them for P1,189 years should you sell
7. Compute the interest per truck per day. The the building for
for an amount of truck has a salvage ₱30,000,000?
p200,000 for a period of value of P100,000 at the 20. The original cost of a
8 years if it is made at end of its useful life of 5 duplicating machine
16% compounded years. The annual cost sold by Lexmark
continuously. of maintenance is P150,000, has an
8. How much money must P20,000. If money is economic life of 8 years
be deposited at the end worth 14% per annum, with a salvage value of
of each year in a determine the number P9,000 at that time. If
savings account that of days per year that a the depreciation of the
pays 9% per year, truck must be used to first year is equal to
compounded warrant the purchase of P44,475, what method
continuously to have a the truck. is used in the
total of ₱10,000 at the 15. The new model of the calculation of the
end of 14 years? lathe machine (200LX) depreciation?
9. An employee is eating costs P200,000 to buy Straight Line Method
₱18,000 a month: and and P30,000 per year to Declining Balance
he can only afford to operate will save labor Method
purchase a car, which expenses of P65, 000 Sinking Fund Method
will require a down per year for 8 years. SYD Method
payment of ₱85,000 and The machine will be 21. A machine costing
a monthly amortization purchased if its salvage P720,000 is estimated
of 30% of his monthly value at the end of 8 to have a book value of
salary. What would be years is sufficiently P40,545.73 when
the maximum cash large to make the retired at the end of 10
value of a car he can investment years: Depreciation cost
purchase if the seller economically attractive, is computed using a
agrees to a down if the interest rate of constant percentage of
payment of ₱85,000 and 10% is used, compute the declining book
the balance payable in 4 the minimum salvage value. What is the
years at 18% per year value.
 annual rate of
depreciation in %? 28. A new boiler was
22. A machine costing installed by a textile
P500,000 has a life of plant at a total cost of
10 years. Using the P300,000 and projected
sum of the years digit to have a useful life of
method, the total 15 years. At the end of
depreciation at the end its useful life, it is
of 4 years is estimated to have a
P276,945.45. Determine salvage value of
the salvage value. P30,000. If operation
23. A machine costs and maintenance
P900,000 and will have amount to P10,000 per
a salvage value of year, determine its
P450,000 when retired capitalized cost if
at the end of 5 years. interest is 18%
Using Sum of Years compounded annually.
Digit Method, what is
the sum of the
depreciation cost in the
first two years?
24. Determine the present
worth of a perpetuity of
P12000 payable
monthly with interest
rate of 8% compounded
continuously.
25. Find the value after 20
years in pesos of an
annuity of P20,000
payable annually for 8
years with the first
payment at the end of 2
years if money is worth
5%

26. A certain sum of money

will be deposited a
savings account that
pays interest at the rate
of 6% per year,
compounded annually. If
all money is allowed to
accumulate, how much
must be deposited
initially so that P5000
will have accumulated
after 10 years?

27. A new bridge with a

100-year life is
expected to have an
initial cost of $20 M.
This bridge must be
resurfaced every five
years at a cost of $1 M.
The annual inspection
and operating costs are
estimated to be
$50,000. Determine the
present worth cost of
the bridge using the
capitalized equivalent
approach (that is the
life of the bridge as
infinite), if the interest
rate is 10% per year,
compounded annually.