1. Mrs.Smith wants to buy a new business asset on January 1, 2021 paying a total of $20,000 ($5,000 down and financing the remaining $15,000 with 10%/year interest payments and a final balloon payment of $15,000 at the end of year 4. The property would be 5-year MACRS property and there would be no 179 or bonus depreciation taken). Fill in the table.

Year 0 1 2 3 4 5

InitialPayment

Interest

CostRecoveryDeductions

InterestDeductions

NetCashFlow

DiscountFactor

NPV

TotalNPV