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Capitalized Cost
Prepared by Bascon Arvin Loui DF.
Nabor John Paolo L.
Mayorga Mark David M.
Castillo Medel
Uniform Arithmethic Gradient Payment
• A= 5000
• G= 400
• P= PA + PG
• P=A/i [ 1-(1+i)^-N] + G/i [(1+i)^N-1/i – (N)](1+i)^-N
• P =5000/.15 [ 1-(1+.15)^-4]+400/.15[(1+.15)^4 -1 / .15 – (4)](1+.15)^-4
• P + 15789.47
• Or using the focal date at (0)
• P= 5000(1.15)^-1 + 5400(1.15)^-2 +5800(1.15)^-3 + 6200 (1.15)^-4
• P = 15789.47
• P= A/i [ 1-(1+i ) ^N]
• Substituting Values A = 5530.80
Financing With Bonds
• A company is issued 50 units of bond with face value of 1000 PHP each to
mature in 10 years at a bond rate of 8% per year If money worth 10% per
year and mass expenses is 2 % of the value dept
• A) the bond value for 1 unit for 50 units
• B) the total annual expenses of the company to retire the bond
Solution