A civil engineer bought a gantry crane for erecting tall buildings. It was invoiced from Japan CIF (cost, insurance, freight) Manila at P250,000. Brokerage, bank, arrastre fees, customs’ duties, permits, etc. total is P120,000. At the end of 10 years, he expects to sell it for P50,000. Determine the book value after 6 years (a) using SLM, (b) using SFM if the rate of interest is 12%, (c) using DBM and (d) using SYDM

A civil engineer bought a gantry crane for erecting tall buildings. It was invoiced from Japan CIF (cost, insurance, freight) Manila at P250,000. Brokerage, bank, arrastre fees, customs’ duties, permits, etc. total is P120,000. At the end of 10 years, he expects to sell it for P50,000. Determine the book value after 6 years (a) using SLM, (b) using SFM if the rate of interest is 12%, (c) using DBM and (d) using SYDM

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 8MC: Grummet Company is acquiring a new wood lathe with a cash purchase price of $80,000. The Wood Master...

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Grummet Company is acquiring a new wood lathe with a cash purchase price of $80,000. The Wood Master Industries (the manufacturer) has agreed to accept $23,500 at the end of each of the next 4 years. Based on this deal, how much interest will Grummet pay over the life of the loan? A. $94,000 B. $80,000 C. $23,500 D. $14,000
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