Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(PROBLEM #5 - 20 marks) Your company has acquired a $500,000. loan for a new 5-Axis machining center. The interest rate for this loan is

image text in transcribed
(PROBLEM #5 - 20 marks) Your company has acquired a $500,000. loan for a new 5-Axis machining center. The interest rate for this loan is 6% per year and your company's initial plan is to pay for the loan in exactly 10 years. Annual payment is made at the end of each year, What is the initial Annual Payment your company has to pay at the end of each year? (a) 63,335 (0) 65,999 (c) 51,072 (d) 67,935 Based on the initial annual payment calculated above, your company has now decides that it can afford to pay $80,000 per year, which is more than the initial annual payment By paying $80,000 annually, after how many payments (years) will the loan of $500,000 be paid off? Assuming the same interest rate is used, i.e. 6% annually (a) 7 years (b) 8 years (c) 9 years (d) 10 years ( By paying $80,000 annually, how much is the last payment. (a) $5.433 35 (b) $10,566.35 (c) $15,010,35 (d) $80,000.00 This 5-Axis machining center's present worth is $500,000. For accounting purpose we use the declining balance depreciation (DBD) model with d=20%, what is the depreciation charge in the 2nd year? (a) $64.000. (b) $80.000 (0) $100,000. (d) None of the above

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Secured Finance Transactions

Authors: Dominic RM Griffiths

2nd Edition

1787425142, 978-1787425149

More Books

Students also viewed these Finance questions

Question

7. It is advisable to do favors for people whenever possible.

Answered: 1 week ago