Solve the Problem

question 36

Multiple Choice

Solve the problem. Use the fire insurance rate table if needed. Rates are for each $100 of insurance. Round to the nearest dollar.
-SLM Instruments owns a class B building with a replacement cost of $602,000. Contents are valued at $302,000. The area is rated 3. Find the fire insurance annual premium.

• A)$506
• B)$4,370
• C)$5,063
• D)$5,243

---

Definitions:

Trade Payables

Amounts owed by a company to its suppliers or vendors for goods and services received but not yet paid for.

Revolving Credit Agreement

A credit arrangement that allows a borrower to withdraw, repay, and re-borrow funds up to a specified limit over a set period.

Agreed Limit

An agreed limit refers to a predetermined maximum amount that an insurance company agrees to pay out for a specific claim or coverage.

Policy Decisions

Decisions made by an organization's leadership or governing body that set its policies, determining strategic direction and actions.