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The pharmaceutical division's interest on debt expense is 4
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10 May 2020, 13:43
10 May 2020, 13:43
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The pharmaceutical division's interest on debt expense is 4 times that of the chemical division. What percent of the chemical division's payroll expense is the pharmaceutical division's payroll expense, rounded to the nearest whole percent?
A. 37
B. 68
C. 137
D. 146
E. 274
Kudos for the right solution and explanation
Re: The pharmaceutical division's interest on debt expense is 4
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11 May 2020, 07:34
11 May 2020, 07:34
6
Let total pharmaceutical division expense = x
Let total chemical division expense = y
It is given that pharmaceutical division's interest on debt expense is 4 times that of the chemical division = 2% of x = 4 * ( 2% of y)
Hence x = 4 * y
hence pharmaceutical payroll expense / chemical payroll expense = \(\frac{(0.26x) }{ (0.38y)}\)
substituting x with 4y we get = \(\frac{(0.26 * 4y) }{ (0.38 * y)}\)
Taking value of y =1 we get = \(\frac{(26 * 4) }{ (38 * 1) }\) = 2.736
Converting this value to percentage = 2.736 * 100 = 273.6
Answer is E
Let total chemical division expense = y
It is given that pharmaceutical division's interest on debt expense is 4 times that of the chemical division = 2% of x = 4 * ( 2% of y)
Hence x = 4 * y
hence pharmaceutical payroll expense / chemical payroll expense = \(\frac{(0.26x) }{ (0.38y)}\)
substituting x with 4y we get = \(\frac{(0.26 * 4y) }{ (0.38 * y)}\)
Taking value of y =1 we get = \(\frac{(26 * 4) }{ (38 * 1) }\) = 2.736
Converting this value to percentage = 2.736 * 100 = 273.6
Answer is E
Re: The pharmaceutical division's interest on debt expense is 4
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14 Jan 2021, 12:10
14 Jan 2021, 12:10
3
Quote:
The pharmaceutical division's interest on debt expense is 4 times that of the chemical division. What percent of the chemical division's payroll expense is the pharmaceutical division's payroll expense, rounded to the nearest whole percent?
#Pharmaceutical division
Cost of interest of debt. : 4X
Total expense : 4Y (Because ratio of interest of debt to total expense is 2 % same as in chemical division.)
Ratio of interest of debt to total expense : 2%.
Ratio of payroll to total expense : 26 % = 0.26 = 26/100
Cost of payroll in Pharmaceutical = 4Y * 26/100
#Chemical division
Cost of interest of debt: X
Total expense : Y
Ratio of interest of debt to total expense : 2%.
Ratio of payroll to total expense : 38 % = 0.38 = 38/100
Cost of payroll in Chemical = Y * 38/100
What we want is
Quote:
What percent of the chemical division's payroll expense is the pharmaceutical division's payroll expense, rounded to the nearest whole percent?
(4Y * 26/100) / (Y * 38/100)
(4Y * 26) / (Y * 38) = (104 * Y) / (38* Y). = 104 / 38 > 2
E is the only option which is over 200 % , so E is the answer.
Answer : E
