Math for Business and Finance
Examination:
06044200

1. Broom Company Bank Reconciliation as of November 1, 2009
Checkbook Balance: $4,010
Deduct bank fee for checks $12.00
Deduct bank fee for NSF $18.00
Deduct ATM withdrawl $30.00
Add Broom note collected $400.00

Reconciled Balance: $4,350.00

Bank Balance: $2,950.00
Deduct outstanding check: No. 124 $1,080.00 No. 138 $720.00
Add deposit in transit $3,200.00

Reconciled Balance: $4,350.00

2. $5.00 erasers per carton
$7.00 pencils per carton

15 cartons total for $85.00
E+P= 15
5E+7P=85
P=15-E
5E + 7(15-E) = 85
5E + 105-7E=85
105 – 2E=85
20E=2E
E=10 and P=5

10 Eraser Cartons were bought and 5 Pencil Cartons were bought

3. Price of Hamburger increased from $1.10 to $1.59
[(1.59 – 1.10) / (1.10)] * 100=
[0.49 / 1.10] * 100=
[0.44545] * 100= 44.5
The price increased up to 44.5%

4. List price on invoice = $5,000
Chain discount received by Morgan= 9/7
Freight charges paid by Lee- $150
Morgan pays Lee $4,039

5. S= selling cost
C= Cost of product
P= percent markup

S=c (1+p)
85=c (1+45%/100=1.45)
C=85/1.45= 58.62
58.62 * 45%= 26/38
58/62 + 26/38= 85
The most she could pay for the bag and still retain the 45% markup of the selling price is $58.62

6. Earning per Week = $1,200.00
Social Security Rate= 74.40
Medicare Rate= 17.40
Cumulative Wages= $6,000.00
Health Insurance = $42.50
Net Pay= $1,065.70

7. Total money Lisa Kane borrowed = $8,000.00
Interest on 60-day note= 8%
Balance she should return- $8,000 + 8% of $8,000 = $8,640.00
After 45 days Lisa paid $2,000 so amount due is $6,640
On the 45th day Lisa paid $1,000 amount due $6,640 - $1,000 = $5,640
Total interest rate = 8%

8. Money accepted by Bob for extension granting = $5,000
After 120 days money would be $5,400
Discount Rate = 9%
$5,400-$486= $4,914
Bob Acquires= $4,914

9. Deposited= $25,000
Interest Rate= 10%
After fourth year $40,000 are deposited more at the interest rate of 10%
25,000 (F/P, 6, 10%) + 40,000 (F/P, 3, 10%) = 116,025 + 132,400= $248,425
At the end of 6 years Jacob has a balance of $248,425.00

10. Roger’s Deposits= $900
Interest Rate semiannually= 6%
Number of deposits = 0
After 8 years= (900(P/A, 6%, 14))
(F/p, 6, 16)= $24,676.55
After 8 years Roger has a balance of $24,676.55

11. Dick Hercher borrowed= $7,000
Before the end of the 14 months he paid $2,660 (190*14=2660)
$7,000 - $2,600= $4,340
The final pay off Dick will pay is $4,340.00

12. Condo listed for $350,000
Net present value= $280,000
Rate of Interest 11% (0.11/12)
Number of years= 25
Annual payment= 280,000 (A/P, 11%, 25) = 33,247.27
Monthly payment= 33,247.27 / 12 = $2,770.61
Total cost he has to pay after 25 years= 280,000 (F/P, 11%, 25) = $32,034,800

13. A. Net Sales: (Gross sales – sales returns) $20,000-$700 = $20,200
B. Gross Profit: (Net sales – Cost of merchandise sold) 20,200 – 7,600 = $12,600
C. Total operating expenses: (Total of all individual expenses) 1,288 + 600 +1,650 + 2,900 + 900= $7,338
D. Net Income: (Gross profit – Total operating expenses) 12,600 – 7,338= $5,262

14. Rate = (1/10)*2= 20%
End of year Cost Depreciation Book Value at end of Yr

1 $25.000 $25.000*20% $25,000-$5,000 = $5.000 = $20,000

2 $20,000 $20,000*20% $20,000-$4,000 = $4,000 = $16,000

15. A. Number of paint sets in stock: Beginning inventory 8 sets, purchases 24 sets, sold 21 sets (8 + 24 – 21= 11) Paint sets in stock = 11 sets
B. Cost of ending inventory under LIFO: 8(1.25) = $10.00, 3(1.50) = 4.50 (10.00+4.50=14.50) Ending inventory = $14.50
C. Cost of ending inventory under FIFO: 1(2.50) = 2.50, 10(3.00) = 30.00 (30.00+2.50=32.50) Ending inventory = $32.50
D. Cost of ending inventory under Weighted Average: 3(1.50) = 4.50 5(2.00) = 10.00 6(2.50) = 15.00 8(1/25) =10.00 10(3.00) = 30.00
Total Cost= 69.50
Average cost per set: (69.50/32) = $2,172
Weighted Average: (11 * 2,172) = $23.89

16. Property tax= Assessed value * mill rate
1,000= (114,500 * 40)/ 1000 = $4,580
Pete’s property tax is $4,580.00

17. Total damages= $600+$1,800+$13,000+$8,000= $23,400
Jim has to pay the $200 deductible
Jim has to pay $3,000 for the amount over $10,000 that was paid to the first passenger.
Jim’s share of responsibility is $3,200
The insurance company pays $20,200 (23,400-3,200)

18. Cost basis: (22.35*200)*1.02= $4,559.40
Sales proceeds: (21.76*200) * (1-0.02) =$6,224.96
Net profit: 6,224.96-4,559.40=1,665.56
8 month return: 1,665/4,559.40= 36.53%

19. Sullivan Realty sales mean & median:
99,000
109,000
126,000
158,000
160,000
175,000
182,000
185,000
189,000
210,000

Mean: 1,593,900 / 10= 159,390
Median: 160,000 + 175,000 / 2 = 167,500

20. Price of Al’s garage: $3o0,000
Fire insurance policy: $180,000 that contains an 80% coinsurance clause
Damage done $210,000, 80% of that = $168,000
Insurance company will have to pay $180,000

21. Total cost of boat: $19,500 + $2,500 = $22,000
Total monthly installments: 36
Per month installments: $22,000/36= $611.11
So, Earl can afford to pay $611.11 a month

22. Peter sold 400 oatmeal for (1.50) Wheat for (2.00) Total sales = $700
2x + [1.50(400-x)] =700
2x + 600-1.50x= 700
0.5x=100 x=200
400-200=200
Pete sold a total of 200 oatmeal and 200 wheat

23. 5% discount = $750
Balance= $14,250
8% discount= $1,140
Balance= $13,110
3% discount= $393.30
Balance payable= $12,716.70
Add the freight payable $200
Total = 12,916.70

24. Mobile oil company 120 day note: $10,000
Interest rate to settle a past due accounts: 8.5%
Discount rate: 9%
Mobilee oil receive proceeds: $10,149.65

25. Amount needed by Ray to retire comfortably: $130,000
Invest today to meet goal: $130,000 (p/f, 14%, 40) = $650.00