4. The purchaser of a tractor paid P 10,000.00 cash and agreed to pay P 3,000.00 at the end ofeach 6 months for 10 years. He failed to make the first five payments of P 3,000.00 each. Atthe end of 3 years he desires the purchase of the tractor by a single payment which willcancel both his accumulated liabilities and his future liabilities. What must he pay if moneyis worth 8% per annum compounded semi-annually?

Solution: PMT = P 3000 N = 10*2 = 20 Rate = 8% / 2 = 4% Calculate the PV = PV(4%,20,-3000)…

Answered: cash and agreed to pay P 10.00 at the…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 21E

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