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XYZ Corp. is purchasing new equipment with a cash cost of $210,618. The manufacturer has offered to accept $50,000 payment (including interest) at the end
XYZ Corp. is purchasing new equipment with a cash cost of $210,618. The manufacturer has offered to accept $50,000 payment (including interest) at the end of each of the next five years. What is the total interest expense that would be incurred by XYZ Corp. over the term of the loan with the manufacturer? What is the interest rate charged by the manufacturer? What would the annual payments be if XYZ obtained financing from the bank @ 4%?
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Future 5 1 Value of S 5 Future . is purchasing new equipmer 1) at the end of each of the next five y 5 5. 5 Present 1.21665 1.27628 1.33823 1.46933 1.61051 1.76234 6% Present value of value of an value of an Present ordinary ordinary annuity value of 1 annuity annuity due 1 0.82193 5.41632 4.45182 4.62990 4% 0.78353 5.52563 4.32948 454595 5% 0.74726 5.63709 4.21236 4.46511 0.68058 5.86660 3.99271 431213 8% 0.62092 6.10510 3.79079 4.16986 10% 0.56743 635285 3.60478 4.03735 12% he in 1. What is the total interest expense that would be incyStep by Step Solution
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