Question: Your firm wants to purchase a 50 000 computer no money

Your firm wants to purchase a $50,000 computer, no money down. The $50,000 will be paid off in 10 equal end of year payments with interest at 8 percent on the unpaid balance.
a) What are the annual end of year payments?
b) What hourly charge should be included to pay off the computer, assuming 2,000 hours work per year, credited at the end of year?
c) Assuming that five years from now you would like to trade this one in an purchase a new computer. You expect a 5 percent increase in price each year. What would the new cost at EOY 5?
d) What is the unpaid balance on the current after five years?

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  • CreatedAugust 26, 2013
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