A lcompany is trying to upgrade its current equipements, whichhas an initial fee of...

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Accounting

A lcompany is trying to upgrade its current equipements, whichhas an initial fee of $30,000. The upgrade is expected to save them$5,000 in year 1 and increase by $500 each year thereafter. At aninterest rate of 15% per year, what is the annual worth of thepurchase over 7 years?

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Calculation of present value of total savings over 7 years Year Savings per year Discounting factor of 15 Present Value 1 5000 0870 4350 2 5500 0756 See Answer

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In: AccountingA lcompany is trying to upgrade its current equipements, whichhas an initial fee of $30,000....A lcompany is trying to upgrade its current equipements, whichhas an initial fee of $30,000. The upgrade is expected to save them$5,000 in year 1 and increase by $500 each year thereafter. At aninterest rate of 15% per year, what is the annual worth of thepurchase over 7 years?