Earl Has Invested $12,000 in a Security That Pays 2

question 18

Multiple Choice

Earl has invested $12,000 in a security that pays 2% annual simple interest.How much interest does he earn in the 3^rd year?

• A)$160
• B)$240
• C)$720
• D)$12,735

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Definitions:

Cost Of Goods Purchased

The amount a company spends to buy or produce the products it sells to customers, excluding operating expenses.

Cost Of Goods Sold

Signifies the immediate expenses related to the manufacturing of products that a company sells.

Gross Profit

The difference between revenue and the cost of goods sold, indicating the financial performance of a company's core business activities.

Beginning Inventory

The value of a company’s inventory at the start of an accounting period, crucial for calculating cost of goods sold during the period.