Question

A company with $60,000 in sales last year had $69,000 in sales this year. Assuming the company's sales continue to grow at the same rate each year, what will the annual sales be two years from now?
 A. $74,000 B. $82,505 C. $79,350 D. $91,253

Answer 1

The easiest method for me when solving percentages is to always find 10% of the number first. This is easy because you just move the decimal to the left once. This means that 10% of $60,000 is $6,000.

Now if you want to find 5% just divide the number that was 10% in half (because half of 10% is 5%). So this gives us that 5% is $3,000.

If we want 15% we simply add these numbers (10%+5%=15%) and we get $9,000. This means that the company's sales grew 15% in one year and $60,000 + $9,000 = $69,000.

But the question is stating that the "company's sales continue to grow at the same rate each year" so we need to find 15% of the new value every time. This means that we need to find 15% of $69,000.

We do the same and start with 10% giving us $6,900. We then find

5% = $3,450 . And then we add the two giving us $10,350.

Don't forget to add this to what we already had because this is just the gain in the second year and your final answer should be $79,350.