Financial Math Answers

A machine costing RM84,000 has a life expectancy of six years and a salvage value of

RM42,000. Construct a depreciation schedule using the sum-of-year digits methods.

A washing machine selling for RM800 cash was purchased through an instalment plan in which

10% down payment was made. The buyer made 20 weekly payments of RM40 each to settle

the balance. Calculate

(a) the instalment price

(b) the total interest charged

(c) the simple interest rate charged

(d) the effective rate charged

A washing machine selling for RM800 cash was purchased through an instalment plan in which

10% down payment was made. The buyer made 20 weekly payments of RM40 each to settle

the balance. Calculate

(a) the instalment price

(b) the total interest charged

(c) the simple interest rate charged

(d) the effective rate charged

A washing machine selling for RM800 cash was purchased through an instalment plan in which

10% down payment was made. The buyer made 20 weekly payments of RM40 each to settle

the balance. Calculate

(a) the instalment price

(b) the total interest charged

(c) the simple interest rate charged

(d) the effective rate charged.

Q1. Show the journal entries necessary to correct the following errors: (a) A sale of goods GHS412 to T More had been entered in T Mone’s account. (b) The purchase of a machine on credit from J Frank for GHS619 had been completely omitted from our books. (c) The purchase of a computer for GHS550 had been entered in error in the Office Expenses account. (d) A sale of GHS120 to B Wood had been entered in the books, both debit and credit, as GHS102. (e) Commission received GHS164 had been entered in error in the Sales account. (f ) A receipt of cash from T Blair GHS68 had been entered on the credit side of the cash book and the debit side of T Blair’s account. (g) A purchase of goods GHS372 had been entered in error on the debit side of the Drawings account. (h) Discounts Allowed GHS48 had been entered in error on the debit side of the Discounts Received account.

1. a) Explain the concept of demand curve for loanable funds.

b) Explain the concept of supply curve for loanable funds.

c) Explain the effect of increasing in government expenditure through selling of bonds on interest rate in classical model.

2. Please use a graph to produce aggregate supply in classical model under the assumption of nominal wage or money wage.

3. Explain the effect of increasing in money supply on price and national income using a classical theory.

4. Explain how interest rate is determined in a classical theory.