# 2024 – 1 Determine the difference between the monthly payments on a 120 000 home at 6 1 2 and at 8 for 25

MCQ – 2024

1 Determine the difference between the monthly payments on a \$120,000 home at 6 1∕2% and at 8% for 25 years.
A \$115.20
B \$91.12
C \$81.12
D \$151.02

3 At the beginning of each year for 14 years, Sherry Kardell invested \$400 that earns 10% annually What is the future value of Sherry’s account in 14 years?
A \$13,100
B \$14,000
C \$12,709
D \$12,309

4 Ted Williams made deposits of \$500 at the end of each year for eight years. The rate is 8% compounded annually. Calculate the value of Ted’s annuity at the end of eight years.
A \$4,318.30
B \$5,318.30
C \$2,873.30
D \$2,837.03

5 With a mortgage of \$48,000 for 15 years with a rate of 11%, what are the total finance charges?
A \$54,576
B \$50,236.80
C \$5,023.68
D 545.76

6 Joe Sullivan invests \$9,000 at the end of each year for 20 years. The rate of interest Joe gets is 8% annually. Determine the final value of Joe’s investment at the end of the 20th year on this ordinary annuity.
A \$88,362.90
B \$411,858.00
C \$411,588.00
D \$88,632.90

7 At the beginning of each year Bill Ross invests \$1,400 semiannually at 8% for nine yrs determine the cash value of the annuity due at the end of the ninth year.
A \$37,399.68
B \$38,739.68
C \$37,339.68
D \$37,939.86

8 Open credit in a revolving charge plan results in
A the U.S. Rule being applied to each purchase
B as many charged purchases till credit limit is reached
C as many cash purchases till credit limit is reached
D one purchase per month

9 Cost of merchandise sold equals beginning inventory
A plus net purchases minus ending inventory
B plus net purchases plus ending inventory
C minus net purchases plus ending inventory
D minus net purchases minus ending inventory

10 In using horizontal analysis comparative reports are
A often used
B never used
C infrequently used
D always used

11 In an ordinary annuity, when does the interest on a yearly investment start building interest?
A At the beginning of the first period
B After the second period ends
C During the first period
D At the end of the first period

12 Given a mortgage of \$48,000 for 15 years with a rate of 11%, what are the total finance charges?
A \$54,576
B \$5,023.68
C \$545.76
D \$50,236.80

13 Lee Company has a current ratio of 2.65. The acid test ratio is 2.01. The current liabilities of Lee are \$45,000 Assuming there are no prepaid expenses the dollar amt of merchandise inventory is
A \$90,450.
B \$90,540.
C \$28,800.
D \$28,008.

14 Megan Mei is charged 2 points on a \$120,000 loan at the time of closing. The original price of the home before the down payment was \$140,000. How much do the points in dollars cost Megan?
A \$2,400
B \$2,800
C \$4,200
D \$8,200

15 Dan Miller bought a new Toyota truck for \$28,000. Dan made a down payment of \$6,000 and paid \$390 monthly for 70 months. What is the total finance charge?
A \$11,300
B \$5,300
C \$27,300
D \$13,300

16 Use the following information to answer the question:
Cost of car: \$26,000
Residual value: \$6,000
Life: 5 years Using the given information, determine the depreciation expense for the first year straight-line method?
A \$4,000
B \$5,200
C \$4,400
D \$6,000

17 Jay Corporation has earned \$175,900 after tax. The accountant calculated the return on equity as 12.5%. Jay Corporation’s stockholders’ equity to the nearest dollar is
A \$14,720.
B \$140,720.
C \$1,407,200.
D \$140,720,000

19 In calculating the daily balance, cash advances are
B always subtracted out.
C sometimes subtracted out.

20 Abe Aster bought a new split level for \$200,000. Abe put down 30%. Assuming a rate of 1 11∕2% on a 30-year mortgage, determine Abes monthly payment.
A \$1,982.00
B \$1,387.40 ß Note I have used 11.5% interest rate.
C \$1,423.80
D \$1,367.80

21 Connie made deposits of \$2000 at the beginning of each year for four years. The rate she earned is 5% annually. What is the value of Connies account in four years?
A \$8,260.00
B \$11,051.00
C \$9,051.20
D \$8,260.20

22 When are annuity due payments made?
A Yearly
B At the end of the period
C At the beginning of the period
D Monthly

23. Ben Brown bought a home for \$225,000. He put down 20% The mortgage is at 6 ½% for 30 years determine his monthly payment.
A \$1,319.04
B \$1,139.40
C \$1,319.40
D \$1,216.80

24 Dick Hercher bought a home in Homewood, Illinois for \$230,000. He put down 20% and obtained a mortgage for 25 years at 8% What is the total interest cost of the loan?
A \$327,372.80
B \$242,411.00
C \$184,000.00
D \$242,144.00

25. John Sullivan bought a new Brunswick boat for \$17,000. He made a \$2,500 down payment on it The banks loan was for 60 months and the finance charges totaled \$4,900. What is his monthly payment?
A \$332.33
B \$313.33
C \$323.33
D \$232.33

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