n asphalt road requires no repairs until the end of 2 years. At the end of 3rd year, P90, 000 will be needed for repairs for the next 5 years, then P120, 000 at the end of each year for the next 5 years. If money is worth 14% compounded annually, what is the present value of the repair cost and its equivalent uniform annual cost for the 12-year period? Show complete solution and formula used. Calculate it manually. Please don't type it. Write it in a paper. Provide cash flow diagram. Thank you! ANS. P = 402,386.46, A = 71,089.35
n asphalt road requires no repairs until the end of 2 years. At the end of 3rd year, P90, 000 will be needed for repairs for the next 5 years, then P120, 000 at the end of each year for the next 5 years. If money is worth 14% compounded annually, what is the present value of the repair cost and its equivalent uniform annual cost for the 12-year period? Show complete solution and formula used. Calculate it manually. Please don't type it. Write it in a paper. Provide cash flow diagram. Thank you! ANS. P = 402,386.46, A = 71,089.35
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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An asphalt road requires no repairs until the end of 2 years. At the end of 3rd
year, P90, 000 will be needed for repairs for the next 5 years, then P120, 000 at
the end of each year for the next 5 years. If money is worth 14% compounded
annually, what is the present value of the repair cost and its equivalent uniform
annual cost for the 12-year period? Show complete solution and formula used. Calculate it manually. Please don't type it. Write it in a paper. Provide
ANS. P = 402,386.46, A = 71,089.35
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