Corgi Inc plans to update its equipment at a total
Corgi, Inc. plans to update its equipment at a total cost of $90,000.
Management anticipates making a $15,000 down payment and borrowing the remainder from a local commercial bank at 12 percent interest. The first option provides for five equal, annual payments to be made at the end of the year. The second option requires five equal, annual payments plus a balloon payment of $15,000 at the end of the fifth year. What are the annual payments required by each option?
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