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Accounting

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Moving to another question will save this response. Question 1 of 5 Question 1 20 points Saved Mapua is considering upgrading the capability of its computer, which has been bought 2 years ago at a cost of PIOM with an annual operating cost of P1,160,662, and if retained for 4 more years, will be sold by then for P500,000. But if it is going to be sold today, it will have a price of 5,485,162. The upgrading requires a medium-size computer having a first cost, life, salvage value, and annual operating costs of P3,255,256, 5 years, P300,000, and P768,933, respectively. This is to be considered the 1st Option The 2nd Option is to buy larger computer, which has a cost of P4.2M, P1.12M salvage value, and P500,000 annual operating cost per year. It would last 5 years. The last option is to lease a computer. The computer has annual payment of P1.4M per year and initial payment of P100,000. It would last 4 years. Assume that the interest rate is 12% per year. What is the Annual Equivalent Cost of the 1st Option? 4.486.699

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