What is the capitalized cost of the marina

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Reference no: EM13838648

An investor is considering the construction of a new marina on the Detroit river at a cost of $68m. M&O costs will average $80,000 per year for the first five years, and rise to $100,000 per year thereafter. A major overhaul costing $12m will be required at the end of the 15^th year. The overhaul will be repeated (at the same cost) every 10 years thereafter. What is the capitalized cost of the marina if the interest rate is 4% per year?

Reference no: EM13838648

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