A local Dunkin’ Donuts shop reported that its sales have increased exactly 16% per year for the last

A local Dunkin’ Donuts shop reported that its sales have increased exactly 16% per year for the last 2 years. This year’s sales were $80,642. What were Dunkin' Donuts' sales 2 years ago?

Declare variable and convert numbers:

• 16% = 0.16
• let the sales 2 years ago be s.

s(1 + 0.16)(1 + 0.16) = 80,642
s(1.16)(1.16) = 80,642
1.3456s = 80642

Solve for s in the equation 1.3456s = 80642

Step 1: Divide each side of the equation by 1.3456
1.3456s/1.3456 = 80642/1.3456
s = 59930.142687277
s = 59,930.14