What is the capital recovery per year for machine

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Reference no: EM131889825

1. What is the capital recovery per year for a machine that has an initial cost of $175,000 and a salvage value of 25% of the initial value over a 7 year life at an interest rate of 6% per year compounded yearly?

$36,560

$26,136

$23,511

$19,453

2. What is the annual capital recovery cost that you should charge your customers if the interest rate is 6.5% per year compounded yearly on a piece of machinery that you bought for $275,000 that is expected to last 10 years. The salvage that can be expected at the end of the machine life is 15% of the original value.

$25,674

$35,197

$38,765

$41,276

Reference no: EM131889825

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