What are some best practices for handling financial calculations in PHP, especially when dealing with percentages and compound interest?

When handling financial calculations in PHP, especially when dealing with percentages and compound interest, it is important to use appropriate data types and precision to ensure accurate results. One common practice is to use the `number_format()` function to format numbers with the desired precision. Additionally, when calculating compound interest, it is recommended to use the `pow()` function to raise a number to a power.

// Example of calculating compound interest with percentages in PHP
$principal = 1000;
$rate = 5; // 5%
$time = 5; // 5 years

// Calculate compound interest
$compound_interest = $principal * pow(1 + ($rate / 100), $time);

// Format the result with 2 decimal places
$formatted_interest = number_format($compound_interest, 2);

echo "Compound interest after $time years: $formatted_interest";