Capitalized cost is an application of perpetuity. It is the sum of the first cost and the present worth of all future payments and replacements. A machine costs P300,000 new, and must be replaced at the end of each 15 years. If the annual maintenance required is P5,000, find the capitalized cost, if money is worth 5% and the salvage value is P50,000. First Cost Present worth of the annual maintenance cost *Letters only Perpetuity of the depreciation cost 321,500 d. 400,500 e. 127,700 Capitalized cost 631,700 a. 178,700 b. 231,700 c. a. 372,700 b. 441,700 c. 529,500 d. 609,500 e