On December 1, Al Smith purchased a car for $25,000. He paid $7500 immediately and agreed...
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On December 1, Al Smith purchased a car for $25,000. He paid $7500 immediately and agreed to pay three additional payments of $8000 each (which includes principal and interest) at the end of 1, 2, and 3 years. Maintenance for the car is projected at $1000 at the end of the first year and $2000 at the end of each subsequent year. Al expects to sell the car at the end of the fourth year (after paying for the maintenance work) for $12,000. Using these facts, prepare a table of cash flows. On December 1, Al Smith purchased a car for $25,000. He paid $7500 immediately and agreed to pay three additional payments of $8000 each (which includes principal and interest) at the end of 1, 2, and 3 years. Maintenance for the car is projected at $1000 at the end of the first year and $2000 at the end of each subsequent year. Al expects to sell the car at the end of the fourth year (after paying for the maintenance work) for $12,000. Using these facts, prepare a table of cash flows.
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Prepare the cash flow as follows N345 1 2 6 A Year 0 1 2 ... View the full answer
Related Book For
Engineering Economic Analysis
ISBN: 9780195168075
9th Edition
Authors: Donald Newnan, Ted Eschanbach, Jerome Lavelle
Posted Date:
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