Millie Electronics, Inc., needs new manufacturing equipment. Two companies can provide similar equipment but under different payment plans: i (Click the icon to view the payment plans.) (Click the icon to view the present value factor table.) (Click the icon to view the present value of annuity factor table.) (Click the icon to view the future value factor table.) (Click the icon to view the future value of annuity factor table.) Read the requirements. Requirement 1. Calculate the present value cost of each payment plan. Let's begin by calculating the present value of Plan A - Driscoll Manufacturing offers to let Millie Electronics, Inc. pay $50,000 at the end of each year for five years. The payments include interest at 8 percent per year. Select the formula and enter the amounts to calculate the present value. (Enter the factor amount to three decimal places, X.XXX, and round your final answer to the nearest whole dollar.) = Present value under Plan A i More Info a. Driscoll Manufacturing offers to let Millie Electronics, Inc., pay $50,000 at the end of each year for five years. The payments include interest at 8 percent per year. b. Waverly, Corp., will let Millie Electronics, Inc., make a single payment of $300,000 at the end of five years. This payment includes both principal and interest at 8 percent. i Reference Periods 5% 0.952 0.907 0.864 0.823 4% 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 03 .676 6% 0.943 0.890 | 0.840 | 0.792 | 0.747 0.705 0.665 0.627 0.592 0.558 Present Value of $1 | 7% 8% | 10% 0.935 0.926 0.909 0.873 | 0.857 | 0.826 0.816 0.794 0.751 0.763 0.735 0.683 0.713 0.681 0.621 0.666 0.630 0.564 0.623 0.583 0.513 0.582 0.540 0.467 0.544 0.500 0.424 0.508 0.463 | 0.386 12% 0.893 | 0.797 0.712 | 0.636 | 0.567 0.507 0.452 0.404 0.361 0.322 14% 0.877 0.769 0.675 0.592 0.519 0.456 0.400 0.351 0.308 0.270 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.746 0.711 0.677 0.645 0.614 10 0 i Reference Periods OVOUAWN 4% 1.040 1.082 1.125 1.170 1.217 1.265 1.316 1.369 1.423 1.480 5% 1.050 1.103 1.158 1.216 1.276 1.340 1.407 1.477 1.551 1.629 6% 1.060 1.124 1.191 1.262 1.338 1.419 1.504 1.594 1.689 1.791 Future Value of $1 7% 8% 9% 1.070 1.080 1.090 1.145 1.166 1.188 1.225 1.260 1.295 1.311 1.360 1.412 1.403 1.469 1.539 1.501 1.587 1.677 1.606 1.714 1.828 1.718 1.851 1.993 1.838 1.999 2.172 1.967 2.159 2.367 10% 1.100 1.210 1.331 1.464 1.611 1.772 1.949 2.144 2.358 2.594 12% 1.120 1.254 1.405 1.574 1.762 1.974 2.211 2.476 2.773 3.106 14% 1.140 1.300 1.482 1.689 1.925 2.195 2.502 2.853 3.252 3.707 16% 1.160 1.346 1.561 1.811 2.100 2.436 2.826 3.278 3.803 4.411 Reference Periods OVAWN 4% 0.962 1.886 2.775 3.630 4.452 5.242 6.002 6.733 7.435 8.111 5% 0.952 1.859 2.723 3.546 4.329 5.076 5.786 6.463 7.108 7.722 Present Value of Annuity of $1 6% 7% 8% 10% 0.943 0.935 0.926 0.909 1.833 1.808 1.783 1.736 2.673 2.624 2.577 2.487 3.465 3.387 3.312 3.170 4.212 4.100 3.993 3.791 4.917 4.767 4.623 4.355 5.582 5.389 5.206 4.868 6.210 5.971 5.747 5.335 6.802 6.515 6.247 5.759 7.360 7.024 6.710 6.145 12% 0.893 1.690 2.402 3.037 3.605 4.111 4.564 4.968 5.328 5.650 14% 0.877 1.647 2.322 2.914 3.433 3.889 4.288 4.639 4.946 5.216 16% 0.862 1.605 2.246 2.798 3.274 3.685 4.039 4.344 4.607 4.833 A Reference Periods ovo AWN 4% 1.000 2.040 3.122 4.246 5.416 6.633 7.898 9.214 10.583 12.006 Future Value of Annuity of $1 5% 6% 7% 18% 9% 10% 1.000 1.000 1.000 1.000 1.000 1.000 2.050 2.060 2.070 2.080 2.090 2.100 | 3.153 3.184 3.215 3.246 3.278 3.310 4.310 4.375 4.440 4.506 4.573 4.641 5.526 5.637 5.751 5.867 16.105 6.802 6.975 7.153 7.336 7.523 7.716 8.142 8.394 8.654 8.923 9.200 9.487 9.549 9.897 10.260 10.637 11.028 11.436 11.027 | 11.491 | 11.978 12.488 13.021 13.579 12.578 13.181 1 13.816 14.487 15.193 15.937 12% 1.000 2.120 3.374 4.779 6.353 8.115 10.089 12.300 14.776 17.549 14% 16% 1.000 1.000 2.140 2.160 3.440 3.506 4.921 5.066 6.610 6.877 8.536 8.977 10.730 11.414 13.23314.240 16.085 17.519 19.337 21.321 Requirements 1. Calculate the present value cost of each payment plan. 2. In addition to the present value cost of the equipment, what other factors should Millie Electronics consider when deciding which company to purchase the equipment from