Your Accountant Tells You That If You Can Continue to Earn

question 47

Multiple Choice

Your accountant tells you that if you can continue to earn the current interest rate on your balance of $800 for the next two years you will have $898.88 in your account. If your accountant is correct what is the current interest rate?

• A)6 percent
• B)7 percent
• C)8 percent
• D)9 percent

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Definitions:

Base Period

A specific time period used as a standard of comparison for financial or economic data.

Analysis Period

The specific span of time for which financial or operational performance is examined and analyzed.

Comparative Statements

Comparative statements are financial statements that provide data for multiple periods side by side, allowing for easy comparison and analysis of performance over time.

Successive Accounting Periods

Consecutive time frames for which a business or organization reports financial information, usually quarterly or annually.