A distillation column can be purchased and installed for P 2,000,000. It will incur P35,000 in...
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A distillation column can be purchased and installed for P 2,000,000. It will incur P35,000 in operations and maintenance expenses and yet can start generating revenues of P125,000 each month as soon as it is installed. The distillation column could be sold at the end of its useful life of 4 years at an estimated price of P150,000. The cost of capital is 15% per annum. The reinvestment rate is 12 %. Before we could evaluate using PW, AW, FW, we need to derive have the effective interest rate per month. What is this effective monthly interest rate? (in interest % with 4 decimals, ex. 0.012575162 is 1.2575.) Do not put the symbol "%" in the answer box. A distillation column can be purchased and installed for P 2,000,000. It will incur P35,000 in operations and maintenance expenses and yet can start generating revenues of P125,000 each month as soon as it is installed. The distillation column could be sold at the end of its useful life of 4 years at an estimated price of P150,000. The cost of capital is 15% per annum. The reinvestment rate is 12 %. Before we could evaluate using PW, AW, FW, we need to derive have the effective interest rate per month. What is this effective monthly interest rate? (in interest % with 4 decimals, ex. 0.012575162 is 1.2575.) Do not put the symbol "%" in the answer box.
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Related Book For
Cornerstones of Cost Management
ISBN: 978-1305970663
4th edition
Authors: Don R. Hansen, Maryanne M. Mowen
Posted Date:
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