The maintenance cost for a sewing machine after one year is expected to be P500. The cost will increase by P50 each year for the subsequent 9 years. The interest is 9% compounded annually. What is the present worth of maintenance for the machine over the full 10 years.

Q: A Freeze dryer is expected to cost RM19,000 two years from now and another RM12,000 four years from…

A: Concept. FV = PV ( 1+ r)n Where , FV = future value  PV = present value  r = interest rate n = time…

Q: A machine costs $5240 and produces benefits of $1000 at the end of each year for 8 years. Assume an…

A: The Payback period is among the of the techniques of capital budgeting that do not take into…

Q: The annual maintenance cost of a generator is P1000 after 1 year and it is estimated to increase 10%…

A: Discounting is a technique which is used to compute the present value (PV) of future amount by…

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A: A capitalized cost of an asset is the cost incurred on an asset to put it to use. Capitalized cost…

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A: EUAC or Equivalent uniform annual cost is the annual cost associated with operating and maintaining…

Q: what is the maximum amount that the company should pay for the machine today such that the chouices…

A: Loan amortization refers to a schedule which is prepared to shows the periodic loan payments, amount…

Q: A precision lathe costs $10,400 and will cost $22,000 a year to operate and maintain. If the…

A: Equivalent annual cost is the cost of operating and maintaining an asset annually. It is also called…

Q: I have purchased a machine worth P1.862.585.00. And it needs maintenance at the end of every 6…

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Q: The annual maintenance cost of a generator is P834 after 1 year and it is estimated to increase by…

A: Annual Maintenance Cost = 834 End of period cost structure Increase in annual maintenance costs =…

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A: The present value is the value of the sum received at time 0. It is the current value of the sum…

Q: What is the final value of $20, 000 if left in an account that pays 10% interest per annum for 30…

A: The final amount after 20 years will be the future value of the initial deposit.

Q: What is the present value of receiving $4,000 per year for 10 years? Your annual required rate of…

A: It can be calculated using PV formula in excel PV (rate, nper, pmt, [Fv], [type]) Rate The interest…

Q: A house is expected to have a maintenance cost of $1000 the first year. It is believed that the…

A: The annual maintenance cost is an increasing annuity. Here we need to find the equivalent annual…

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A: NPV is also known as Net present value. It is a capital budgeting techniques which help in decision…

Q: What is the final value of $20,000 if left in an account that pays 10% interest per annum for 30…

A: Using excel FV function

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A: Discounted payback refers to the method of capital budgeting in which time period taken to convert…

Q: A machine has a useful life of 10 years. It requires a semi- annual operating cost of $3,000 for the…

A: Useful life = 10 yearsSemi-annual operating cost = $3000Number of years = 4Growth rate = 6%Interest…

Q: A machine has 20 years of life. The income = %3D 15000 for the first year decrease by 250 each year…

A: In this question present value is to be find out. Given that the machine depreciates by $250 each…

Q: An annual maintenance cost of a generator is P1000 after two years and it is estimated to increase…

A: The question is based on the concept of Financial Accounting. As the cost is increasing by 10% per…

Q: A project requires a $33,000 initial investment and is expected to generate end-of-period annual…

A: Net present value is most important and commonly used method of capital budgeting and is based on…

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A: NPV is also known as Net Present Value.. It is a capital budgeting technique which helps in decision…

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A: The intrinsic price (actual worth) of an asset is present value of its future income. To solve this…

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A: Annuity means a set of finite number of payments which are the same in size and made in equal…

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A: Amount to be invested each year = A r = 7% Accumulated amount = $12000 n = 19 years

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A: The present value of future and periodic cash flows is the value of these cash flows at the present…

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.