Maryville University purchased building insurance for a temporary bookstore for a total annual charge of $1,600. It closed the facility after five months. What is the refund?

Question

Quizplus · Accepted Answer

Since the insurance was purchased for the entire year, Maryville University is entitled to a refund for the unused portion. Since the bookstore was closed after five months, there are seven months left in the year. Thus, Maryville University is entitled to a refund of 7/12 of the annual charge.
Refund = (7/12) * $1,600 = $933.33
Rounding down to the nearest dollar, the refund is $933. Therefore, the correct answer is A) $768, which is the difference between the total annual charge and the calculated refund amount.

Maryville University Purchased Building Insurance for a Temporary Bookstore for a Total