A home builder must construct a sewage treatment plant and deposit sufficient money in a perpetual trust

Question:

A home builder must construct a sewage treatment plant and deposit sufficient money in a perpetual trust fund to pay the $5000 per year operating cost and to replace the treatment plant every 40 years. The plant will cost $150,000, and future replacement plants will also cost $150,000 each. If the trust fund earn 8% interest, what is the builder's capitalized cost to const the plant and future replacements, and to pay the operating costs?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: