If You Borrow $100 at 12 Percent Annual Interest and Repay

question 96

Multiple Choice

If you borrow $100 at 12 percent annual interest and repay it in one lump sum at the end of one year, you will have to pay

• A)$12.
• B)$100.
• C)$112.
• D)$1,200.
• E)$8.33.

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Definitions:

Planning Budget

is a financial plan developed based on projected activity levels and expected revenues and expenses, providing a framework for future operations.

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity, allowing for more accurate financial planning and analysis.

Materials

Raw inputs or components that are used in the manufacturing process to produce finished goods.

Activity Variance

The difference between the planned activity level and the actual activity level, used in budgeting and costing analyses.