Business Calculations - 2006 SLC

1) Kathy earned a total of $1,648.00 from summer babysitting. Kathy paid $379.04 in required taxes. She also spent $230.00 for
gas. What was Kathy’s disposable personal income for the summer?
A) $1,648.00
B) $1,268.96
C) $1,418.00
D) $1,038.96

2) Ryan earned 75% on his history exam. If there were 80 questions on the exam, how many did he answer correctly?
A) 60
B) 68
C) 58
D) 62

3) Jim made 8 free throws in 17 attempts. Rounded to the nearest whole number, what percent of free throws did he make?
A) 23%
B) 51%
C) 56%
D) 47%

4) Gas is selling for $1.89/gallon. Last year at this time, gas was selling for $1.68/gallon. Rounded to the nearest whole percent,
by what percent did the price of gas increase from last year?
A) 21%
B) 11%
C) 13%
D) 18%

5) Laura took out a short-term loan of $4,800. She has to repay it in 5 months and will be charged 12% simple interest. What is
the amount of interest she will pay?
A) $ 240.00
B) $ 186.67
C) $2,880.00
D) $ 360.00

6) Jake’s Sporting Goods purchases hood shirts at $10.50 each. The sporting good company marks these up 160%. What is the
marked sales price per hood shirt?
A) $16.80
B) $22.50
C) $15.23
D) $18.20

7) Your favorite store marks everything up 32%. Last week you spent $187.50 in your favorite store. What did your items that
you purchased cost your favorite store?
A) $142.68
B) $147.50
C) $127.50
D) $169.32

8) Jim bought a new refrigerator for $1,050.00 on February 12. He purchased it from Siemer’s Appliances, which gives
customers a cash discount of 3/10, n/30. What is the amount due if Jim pays on February 20?
A) $1,050.00
B) $ 31.50
C) $ 972.00
D) $1,018.50

9) Calculate the total deposit using the following information:

Currency: $50 bills—3, $20 bills—7, $10 bills—3, $5 bills—6, $1 bills—12
Coins: 4 rolls of quarters, 2 rolls of dimes, 4 rolls of nickels, and 52 pennies
Checks: #510-321 for $277.46, #35-742 for $199.28
A) $885.26
B) $896.74
C) $747.74
 D) $897.26

10) Gerald earns an annual salary of $51,600. He is required to work overtime as needed for which he is paid time and a half.
This month he worked 28 hours overtime. What is his gross salary for the month with 22 working days?
A) $5,326.20
B) $1,026.20
C) $4,984.09
D) $4,300.00

11) Richard wrote eleven checks totaling $791.23 and deposited one paycheck for $341.76 during the month. His beginning
balance was $1,011.91. Richard’s bank charges $0.50 for each check over 8 written during the month. What is his ending
balance for the month?
A) $560.94
B) $220.68
C) $562.44
D) $563.94

12) Richard heard about another bank that will pay him 1.5% simple interest on the last day of the month based on his ending
balance after charges. How much interest would Richard receive using the ending balance from the question above?
A) $ 8.46
B) $84.37
C) $ 8.41
D) $84.14

13) Calculate the cost of 9% inflation for two years on the cost of a $25,000 car.
A) $ 2,250.00
B) $27,250.00
C) $29,702.50
D) $ 2,452.50

14) This year’s inflation rate is 2.7%. You placed $2,000 in a savings account at the beginning of the year earning 2%. How much
must you deposit in the account at the end of the year to hold the same purchasing value?
A) $45.00
B) $14.00
C) $54.00
D) $40.00

15) Andy’s grandparents gave him a $100 gift certificate to a sporting goods store. Andy found Nike shocks, but they cost $120.
After the holidays, the shocks went on sale for 25% off. How much money was left after he bought the Nike shocks on sale if
tax was 8%?
A) $22.80
B) $11.50
C) $90.00
D) $ 2.80

16) Lisa took out student loans to pay for college. She makes a payment of $198/month for 4 years to pay off the loan. How much
does she pay in 4 years?
A) $9,504
B) $7,920
C) $ 792
D) $7,128

17) $521 is 40% of what amount?

A) $ 312.60
B) $1,302.50
C) $ 868.33
D) $ 208.40

18) What percent of $2,500 is $9,500?

A) 38%
B) 2.63%
C) 380%
 D) 26.3%

19) What is 21% of $732?

A) $153.72
B) $ 15.37
C) $286.89
D) $578.28

Use for the next 3 questions.

Use the following information and straight-line depreciation to calculate your answers.

Your company purchases a computer for $4,000 on January 1. The business anticipates that the computer will be useful for 3
years. At the end of 3 years, your business expects to sell the computer for $700.

20) What is the annual amount of depreciation?

A) $1,566.67
B) $1,100.00
C) $1,333.33
D) $ 700.00

21) What is the accumulated depreciation at the end of year 5?

A) $2,100
B) $4,000
C) $ 700
D) $3,300

22) What is the book value of the computer machine at the end of year 5?
A) $ 0
B) $2,100
C) $ 700
D) $1,100

23) If I buy a $20,000 truck for cash, the dealership will give me $2,000 cash back. If I pay $4,000 down, I can finance my truck
for 4 years and pay $350/mo. How much more does financing cost me totally?
A) $3,200
B) $2,800
C) $ 800
D) $2,000

Use for the next 2 questions.

You purchased a $5,000 copy machine for your school on May 20. You paid for the machine on May 25. It was delivered on May 22,
but due to the end of school, you did not begin to use the copy machine until August 15.

24) How many months depreciation are you entitled to for this year?
A) 12 months
B) 5 months
C) 8 months
D) 7 months

25) Calculate this year’s depreciation using straight-line depreciation over a five-year period.
A) $ 666.67
B) $ 583.33
C) $1,000.00
D) $ 416.67

Use for the next 2 questions.

Perry, Inc. notified dealers that it will offer quality printers at a list price of $400, less 40%, less 10%, less 5%.

26) What is the total discount?

A) $194.80
B) $100.00
 C) $189.40
D) $220.00

27) What is the dealer cost?

A) $300.00
B) $205.20
C) $180.00
D) $210.60

28) What is the single discount equivalent for chain discounts 25%, 15%, and 5%?
A) 55.00%
B) 45.00%
C) 39.44%
D) 60.56%

29) Find the dealer cost when the list price is $103 with chain discounts of 12% and 10%.
A) $22.66
B) $21.42
C) $81.58
D) $80.34

30) David has been earning 9.9% simple interest for the last 8 months on $4,500. How much has he earned?
A) $ 44.55
B) $ 29.70
C) $445.50
D) $297.00

31) Casey answered 71 out of 80 questions correctly. What percent did he answer incorrectly?
A) 11%
B) 15%
C) 85%
D) 89%

Use for the next 4 questions.

“Best Buy” marked a computer down from $4,500 to $3,300.

32) What is the markdown based on the old selling price?

A) 45%
B) 29%
C) 36.2%
D) 26.7%

33) What is the markdown based on the new selling price?

A) 29%
B) 36.2%
C) 45%
D) 27.5%

34) This computer did not sell at $3,300. It was marked down an additional 20% from the $3,300 price. What was its new selling
price?
A) $2,840
B) $2,860
C) $2,460
D) $2,640

35) What was the total percent markdown based on its original price?
A) 58.6%
B) 41.3%
C) 50%
D) 46.7%
36) Matt usually works an 8-hour shift each day, 5 days a week, and earns $16.50/hr. If he works overtime, he is paid time and a
half. His gross pay for one week was $981.75. How many hours did he work?
A) 53 hrs
B) 58 hrs
C) 43 hrs
D) 60 hrs

37) Lauren is paid $11.25/hr. and double time on Sunday. Susan works 5 hours on Sunday, 8 hours on Monday, 9 on Tuesday, 10
hours on Wednesday, 6.5 hours on Thursday, and 9.5 hours on Friday. What is her gross pay?
A) $596.25
B) $613.13
C) $585.04
D) $540.00

38) Two chairs are shipped from Boston to Los Angeles. Each chair cost $68.00. Terms were 3/10, 2/20, n/30. Shipping was
$6.18. What is the total amount due if paid within ten days?
A) $ 84.18
B) $142.18
C) $131.92
D) $138.10

39) Lacie earns an annual salary of $68,300. She is paid bi-weekly. What is her gross bi-weekly pay?
A) $1,313.46
B) $5,691.67
C) $2,845.83
D) $2,626.92

40) Chelsea works for commission. She is paid 5% on the first $5,000 of sales, 8% on the next $5,000, and 15% on sales over
$10,000. If she sold $13,200 dollars, how much did she earn?
A) $2,700
B) $3,696
C) $1,130
D) $1,980

41) Elizabeth had an annual gross salary of $74,800 last year. Based on a FICA tax of 6.20%, how much was deducted for FICA
taxes?
A) $4,565.32
B) $4,809.53
C) $4,637.60
D) $5,000.21

42) Don has $7,421 in his savings account. It earns 2.75% interest. After 13 months, how much simple interest will Don earn?
A) $213.10
B) $231.10
C) $221.08
D) $212.08

43) Katie borrowed $8,750 for 145 days at 7.5% interest from her bank. Use the ordinary interest method to compute the interest,
Katie will pay.
A) $260.70
B) $656.25
C) $264.32
D) $246.31

44) Use the exact interest method to calculate the maturity value: Principal=$6,900, Rate=9.75%, Term=135 days.
A) $7,418.38
B) $7,152.28
C) $7,572.75
D) $7,148.83

45) You purchased a pair of running shoes for $82.00. The trade discount rate is 40%. What is the dealer cost?
A) $42.90
 B) $38.20
C) $49.20
D) $32.80

46) Michael purchased a four-wheeler for $3,125. There was a trade discount of 32%. What was the trade discount amount?
A) $2,125.00
B) $1,225.25
C) $1,000.00
D) $ 718.75

Use for the next 7 questions.

Use the chart to calculate your answers.

47) Calculate the sale price for $52.79

A) $54.25
B) $37.89
C) $39.99
D) $24.25

48) Calculate the markdown percentage for $52.79

A) 12.80%
B) 75.75%
C) 88.20%
D) 24.25%

49) Calculate the sale price for $192.74.

A) $ 36.27
B) $ 52.50
C) $165.74
D) $156.47

50) Calculate the amount of the markdown for $192.74.

A) $73.73
B) $36.27
C) $25.00
D) $18.82

51) Calculate the amount of the markdown for $544.66.

A) $100.00
B) $118.36
C) $100.25
D) $ 18.36

52) Calculate the markdown percentage for $544.66.

A) 18.36%
B) 23.08%
C) 10.00%
D) 35.00%

53) Calculate the markdown percentage for $711.12.

A) 15.63%
 B) 84.37%
C) 83.64%
D) 16.36%

54) The carpet chosen by Callis International for their reception area was $16.75 a square yard. What price should the store quote
for the carpet if the reception area is 12 ft. 6 in. by 18 ft.?
A) 480.75
B) 418.75
C) 415.25
D) 481.25

55) Jane uses ten 100-watt bulbs in her house. She burns these bulbs an average of 5 hours each day. How many KWH do these
bulbs use each day?
A) 5 KWH
B) 50 KWH
C) 500 KWH
D) 5,000 KWH

56) You set your thermostat at 72 degrees. Raising it in the summer may reduce your cooling costs by as much as 3% for each
degree it is raised. If you raised your thermostat to 77 degrees, what percent of your fuel costs could you save?
A) 18%
B) 15%
C) 10%
D) 13%

57) A real estate agent sold a 10-room house for Donna for $135,600. The listing price of the house was $150,000. The agent
deducted a 6% commission. What net proceeds did Donna receive for the sale of her home?
A) $141,000
B) $127,464
C) $ 9,000
D) $ 8,136

58) What is the cost of 11,500 lb of gravel @ $32.50 per ton?

A) $1,868.80
B) $ 186.88
C) $3,737.50
D) $ 188.68

59) A 400-cm length of tubing costs $0.36. What is the cost of tubing per meter?
A) $0.12
B) $0.36
C) $0.09
D) $0.90

60) What is the cost of 320 lb. @ $0.37 ½?

A) $122.00
B) $ 12.00
C) $120.00
D) $102.00

61) Peter Hunter obtained a 75% mortgage valuing $275,000 to purchase a new home. What was the price of the home rounded to
the nearest dollar?
A) $366,667
B) $206,250
C) $350,881
D) $285,500

62) Monroe’s Pharmacy operating expenses this year amounted to $49,290. Last year they were only $25,711. Find the
percentage of the operating expenses increase.
A) 47.8%
B) 51.5%
C) 91.7%
 D) 42.3%

63) Marcy received a statement from the county assessor’s office that stated her property was valued at $76,780. Later she
received her tax bill. The percentage used to find the assessed value was 20%, and the tax rate was $10.9876 per $100. How
much was Marcy’s total tax bill?
A) $1,687.26
B) $8,436.27
C) $6,578.92
D) $1,878.26

64) Mr. and Mrs. Henrickson insured their building for 50% of its $250,000 value under a policy with an 80% co-insurance
clause. The building was damaged by fire in the amount of $100,000. How much did the insurance company pay?
A) $50,000
B) $37,500
C) $80,000
D) $62,500

65) Katy’s factory produced 800 tables at a total cost of $19,200. If direct materials amounted to $11,814 and direct labor equaled
$5,226, how much was overhead as a percentage of direct materials?
A) 11.25%
B) 44.24%
C) 18.28%
D) 41.32%

66) School supplies purchased August 6 for a school has an invoice price of $665.43 with terms of 3/10, n/30. The invoice was
paid August 10. What was the cash price?
A) $685.39
B) $665.54
C) $598.89
D) $645.47

67) John bought a new big screen television on credit for $1,878.96. The cash price of the television was $1,689.59. If he chooses
to pay for it in 18 monthly installments, John will also be required to pay 10% down. What would John’s monthly payment
be for 18 months?
A) $104.39
B) $ 95.00
C) $ 93.95
D) $ 93.87

68) Mr. Johnson invested $50,000 in a franchised office cleaning service. He earned $5,800 the first year. What was the rate of
return on his investment?
A) 9.9%
B) 11.6%
C) 10.7%
D) 12.1%

Use for the next 2 questions.

Use the chart to calculate your answers.

69) George is 40 and wants to purchase $250,000 of term life insurance. What is his premium for the first year?
A) $ 1,717.50
B) $ 6,780.00
 C) $17,175.00
D) $16,987.00

70) What would Nancy’s premium have been for the 1st year if she had purchased $250,000 whole life when she was 20?
A) $ 390.00
B) $2,011.00
C) $1,212.50
D) $2,412.50

71) 58% of the 1700 Brown High School students passed the state-mandated math proficiency test in 2005. How many failed the
test?
A) 986
B) 691
C) 784
D) 714

72) Using the double declining balance method, calculate the depreciation for the first year for machinery that cost $35,000 and is
expected to have a useful life of 5 years?
A) $ 8,400
B) $ 7,000
C) $ 5,040
D) $14,000

73) McClard’s Gift Shop bought a microcomputer for $5,000 and expects to use it 5 years. At the end of the fifth year, it will be
traded for a newer model. How much is the annual depreciation using the straight-line method if the estimated salvage value
is $1,000?
A) $1,000
B) $1,200
C) $ 800
D) $ 600

74) An equipment manufacturer prices equipment at $36,750. It will finance the sale over a 2-year period, and monthly payments
will be $1,834.74. How much finance charges did the buyer pay to purchase this equipment?
A) $7,283.76
B) $8,125.88
C) $6,989.99
D) $7,328.67

75) Ken took a ski vacation in New Hampshire. He paid $227.50 for plane fare and $198.80 for a ski package consisting of 2
nights lodging, meals, and a lift ticket for three days. In addition, he paid $14.50 each of the three days to rent skis. How
much did Ken’s trip cost?
A) $462.30
B) $498.60
C) $426.30
D) $469.80

76) Mr. Powell owns a small car he uses in his business. His semiannual premium for liability insurance is $40.80, and his
semiannual premium for $50-deductible collision insurance is $82.00. His semiannual comprehensive insurance premium is
$45.80, and for towing insurance is $1.20. He also pays $6.80 per year for uninsured motorist coverage. What is Mr.
Powell’s yearly premium?
A) $446.40
B) $346.40
C) $176.60
D) $353.20

77) Find the gasoline cost for the year for someone who traveled 28,440 miles in a company car averaging 24 miles per gallon.
The cost of gas was $1.839 per gallon.
A) $2,179.22
B) $2,719.22
C) $2.467.12
D) $2,823.32
Use for the next 3 questions.
Suzanne is considering a $250,000 business loan. The first is 8 7/8% ordinary interest. The second is 8 7/8 % exact interest. She
expects to repay the loan in 120 days.

78) Comparing the ordinary interest costs to the exact interest costs, Suzanne will pay how much, more or less?
A) $101.31 more
B) $ 79.16 less
C) $179.40 more
D) $101.31 less

79) What is the total interest due if Suzanne selects the ordinary interest arrangement?
A) $7,294.52
B) $7,395.83
C) $7,216.43
D) $7,316.67

80) What is the total interest due if Suzanne selects the exact interest arrangement?
A) $7,216.43
B) $7,294.52
C) $7,395.83
D) $7,316.67

81) Find the total investment in 100 shares of stock bought at 24 when the purchase is handled by a full-service broker who
charges $17 plus 1.3% of the transaction amount?
A) $2,417.00
B) $2,430.16
C) $2,448.20
D) $2,548.20

82) Calculate the interest on a one-year CD with an initial deposit of $4,000 earning 5.5% interest compounded semiannually.
What will the balance be at the end of one year?
A) $4,220.00
B) $4,452.10
C) $4,232.10
D) $4,440.00

83) A $1,500 bond has a quoted price of 80 ¼. It pays interest at 6 ¼%. What is its annual yield to the nearest hundredth of a
percent?
A) 6.25%
B) 7.82%
C) 8.25%
D) 6.25%

84) The Federal Reserve requires banks to hold a reserve on deposits. A 3% on the first $35.2 million and 8% on all amounts
above that. If a bank had 78 million in deposits, what is the amount of required reserves?
A) $6.24 million
B) $4.71 million
C) $4.48 million
D) $2.34 million

85) You deposit $1,000 in a bank that has a 10% reserve. How much money has your $1,000 created after four deposits?
A) $3,600.00
B) $1,000.00
C) $2,439.80
D) $3,095.10

86) KayBees purchased computer games for $132/doz. Each game retails for $29.95. To the nearest tenth, what is the rate of
markup based on Johnny’s cost?
A) 272.3%
B) 172.3%
C) 8.3%
D) 77.1%
87) You put $20 into a savings each week earning 5% interest compounded annual. What is the balance in your savings account
at the end of five years?
A) $6,099.33
B) $5,460.00
C) $6,033.99
D) $5,640.00

88) Using Rule of 78s, find the amount of interest earned in 5 months in a 1-year installment loan agreement calling for interest of
$468.
A) $273
B) $195
C) $168
D) $300

89) Find the adjusted gross income for Mike and Carol if they invested $4,000 in an IRA, had income from their business of
$16,000, and received $25,000 from a life insurance policy upon death of a relative.
A) $21,000
B) $37,000
C) $12,000
D) $41,000

90) The owner of a construction company is filling a 15-foot by 30-foot swimming pool to an average depth of 6 feet. If 1 feet
cubed holds 7 ½ gallons of water, how many gallons of water does the swimming pool hold?
A) 18,735 gallons of water
B) 20,250 gallons of water
C) 30,375 gallons of water
D) 15,502 gallons of water

91) An item costs $520 and has a selling price of $860. Calculate the markup based on cost.
A) 165.3%
B) 39.5%
C) 60.5%
D) 65.4%

92) Anthony had a loan in the amount of $7,500 at 18% for 2 years. What is the total amount Anthony repaid?
A) $ 270
B) $ 225
C) $ 2,700
D) $10,200

93) Carla’s bank statement shows a balance of $674.32. She has $850.00 in outstanding deposits. She visited her ATM and
withdrew $90.00. Carla’s outstanding checks are $42.11, $79.80, $600, $81.50, and $174.00. What balance should her
checkbook show?
A) $499.02
B) $499.02
C) $546.91
D) $456.91

94) Calculate the reconciled balance given the following information:

Bank Statement Balance: $578.93
Outstanding Checks: $31.54; $49.67; $102.45
Outstanding Deposit: $135.15
Stop Payment Charge: $15.00
Service Charge: $8.50
Check Register Balance: $553.92
A) $530.42
B) $505.41
C) $569.43
D) $627.44
95) If you had $8,400 placed in an account that earned 5 ½ percent interest, paid just once a year, how much money would be in
the account at the end of four years?
A) $10,406.13
B) $ 9,863.63
C) $ 9,863.63
D) $ 9,863.63

96) Hometown Bank (HB) has a revenue of $220,250 and expenses of $210,250. HB’s total assets equal $171,500 and liabilities
equal $100,000. Calculate HB’s return on assets (ROA).
A) 7.79%
B) 8.16%
C) 5.8%
D) 4.5%

97) Using the information from question 98, calculate the return on equity (ROE) for HB.
A) 10.0%
B) 13.9%
C) 5.8%
D) 34.0%

98) The inventory at Sam’s Shop was taken at retail prices, with prices being read directly from the price tags. The inventory
totaled $85,000. If the markup is 42% on retail, what is the cost of the inventory?
A) $49,300
B) $47,800
C) $43,900
D) $35,700
1) A 34) D 67) B
2) A 35) B 68) B
3) D 36) A 69) A
4) C 37) B 70) D
5) A 38) D 71) D
6) A 39) D 72) D
7) C 40) C 73) C
8) D 41) C 74) A
9) D 42) C 75) D
10) A 43) C 76) B
11) A 44) D 77) A
12) C 45) C 78) D
13) C 46) C 79) B
14) B 47) C 80) B
15) D 48) D 81) C
16) A 49) D 82) B
17) B 50) B 83) A
18) C 51) A 84) C
19) A 52) A 85) D
20) B 53) A 86) B
21) D 54) B 87) C
22) C 55) A 88) D
23) B 56) B 89) C
24) B 57) B 90) B
25) D 58) B 91) D
26) A 59) C 92) D
27) B 60) C 93) D
28) C 61) A 94) A
29) C 62) C 95) A
30) D 63) A 96) C
31) A 64) D 97) B
32) D 65) C 98) A
33) B 66) D