ESB Financial Problems

Last month, you spent $1,000 on a Pay-Per-Click (PPC) online advertising campaign that resulted in $1,200 in sales.

What was last month's Return on Investment (ROI) for your affiliate marketing service?

• 20%

• 80%

• 120%

• .2%

Answer explanation

ROI is calculated as (Net Profit / Cost of Investment) x 100. Here, Net Profit = Sales - Cost = $1,200 - $1,000 = $200. Thus, ROI = ($200 / $1,000) x 100 = 20%. Therefore, the correct answer is 20%.

You have the following financial information for the month:

Initial cash balance: $1,500

Projected revenue: $2,500

Gas: $100

Equipment maintenance fees: $300

Truck payment: $400

Payroll: $3,000

Insurance: $120

What is your projected ending cash balance for the month?

• $4,000

• $80

• ($1,420)

• $3920

Answer explanation

To find the ending cash balance, start with the initial cash balance of $1,500, add projected revenue of $2,500, and subtract total expenses ($100 + $300 + $400 + $3,000 + $120 = $4,220). The ending balance is $1,500 + $2,500 - $4,220 = $80.

Devin owns a clothing store. He recently purchased jeans to sell in his store. He paid $23 for each pair of jeans, and his desired profit margin is 18%. What is Devin's selling price?

• $28.23

• $27.07

• $27.14

• $22.14

Answer explanation

To find the selling price, calculate the desired profit: $23 x 0.18 = $4.14. Add this to the cost: $23 + $4.14 = $27.14. Thus, Devin's selling price is $27.14.

Tom owns a hat shop. His total monthly cost is $1,850. Each hat costs $50. How many hats must Tom sell to break even each month?

• 39

• 38

• 37

• 40

Answer explanation

To break even, Tom needs to cover his total monthly cost of $1,850. Each hat sells for $50. Dividing $1,850 by $50 gives 37 hats. Therefore, Tom must sell 37 hats to break even.

Hailey has a beginning cash balance of $4,700, $101,000 in total cash sales, $3,300 for utilities, $2,500 in loan payments, and $5,600 for marketing costs. What is the ending cash balance?

• 94,300$

• $94,600

• $105,700

• $11,400

Answer explanation

To find the ending cash balance, add the beginning cash balance ($4,700) to total cash sales ($101,000) and subtract expenses (utilities $3,300, loan payments $2,500, marketing $5,600). This results in $94,300.

One box of chocolates costs $6.75 to produce. The boxes sell for $10. What is the return on investment (ROI)?

• 48%

• 47%

• 45%

• 46%

Answer explanation

To calculate ROI, use the formula: ROI = (Profit / Cost) x 100. Profit per box = Selling price - Production cost = $10 - $6.75 = $3.25. ROI = ($3.25 / $6.75) x 100 = 48%. Thus, the correct answer is 48%.

Sarah runs a bakery and sells cupcakes for $2 each. Her monthly expenses include $800 for rent, $600 for ingredients, and $400 for staff salaries. How many cupcakes does she need to sell to cover her expenses?

• 900

• 950

• 1000

• 850

Answer explanation

Sarah's total monthly expenses are $800 (rent) + $600 (ingredients) + $400 (salaries) = $1800. To cover this, she needs to sell $1800 / $2 per cupcake = 900 cupcakes. Thus, the correct answer is 900.

A bookstore purchases novels at $8 each and sells them at a 25% markup. What is the selling price of each novel?

• $10

• $9

• $10.50

• $10.25

Answer explanation

The bookstore marks up the purchase price of $8 by 25%. To find the selling price, calculate 25% of $8, which is $2. Add this to the original price: $8 + $2 = $10. Therefore, the selling price of each novel is $10.

Linda's boutique had an initial cash balance of $2,000. After one month, total sales amounted to $15,000, and expenses included $3,000 for rent, $4,000 for merchandise, and $2,500 for salaries. What is the ending cash balance?

• $7,500

• $7,000

• $8,000

• $6,500

Answer explanation

Starting cash: $2,000. Total sales: $15,000. Total expenses: $3,000 (rent) + $4,000 (merchandise) + $2,500 (salaries) = $9,500. Ending cash balance: $2,000 + $15,000 - $9,500 = $7,500. Thus, the correct answer is $7,500.

Mark owns a bookstore and his monthly rent is $1,200, his staff salaries total $2,800, and other expenses amount to $1,000. If he sells books for $15 each, how many books must he sell to cover his monthly expenses?

• 343

• 334

• 330

• 370

Answer explanation

Mark's total monthly expenses are $1,200 + $2,800 + $1,000 = $5,000. To cover this, he needs to sell 5,000 / 15 = 333.33 books. Rounding up, he must sell 334 books to cover his expenses.