What would be the original cost of the equipment

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Reference no: EM131061520

The capitalized cost for a piece of equipment has been found to be $55,000. This cost is based on the original cost plus the present value of an indefinite number of renewals. An annual interest rate of 12 percent was used in determining the capitalized cost. The salvage value of the equipment at the end of the service life was taken to be zero, and the service life was estimated to be 10 years. Under these conditions, what would be the original cost of the equipment?

Reference no: EM131061520

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