Determine the equivalent annual cost of investment


Question:

An agribusiness has a chance to invest in new equipment that costs $999,905.40. It is expected to bring savings of $171,000 per year for the next 15 years. The firm normally earns ten percent per year on its investments. Using the information given above determine the benefit-cost of this investment. Using the information given above determine the equivalent annual cost (EAC) of this investment.

Solution Preview :

Prepared by a verified Expert
Accounting Basics: Determine the equivalent annual cost of investment
Reference No:- TGS02051693

Now Priced at $10 (50% Discount)

Recommended (91%)

Rated (4.3/5)