Annuity

-Use 6 decimal places in between process and 2 decimal places for the final answer.

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Casio Inc. expects to retire an existing machine at the end of 2013 and will replace it with a new machine for the same task at an estimated cost of P600,000. The old machine can be sold for P50,000 when it is replaced. To provide for replacement, the company intends to deposit the following amounts in an account earning interest at 8% compounded quarterly: P200,000 at the end of 2010; P150,000 at the end of 2011; P100,000 at the end of 2012. What additional amount is needed at the end of 2013 to purchase the new machine? A house and lot can be acquired by a down payment of P500,000 and a yearly payment of P100,000 at the end of each year for a period of 10 years, starting at the end of 5 years from the date of purchase. If money is worth 14% compounded semi annually, what is the cash price of the property