Chapter 15 Problem 15-26 to 30
Problem 15-26 Answer D
Cost of land (5,400,000 x 2/5) 2,160,000
Problem 15-27 Answer B
Cash price 950,000
Installation cost 30,000
Total cost 980,000
Problem 15-28 Answer C
Cash price 2,000,000
Installation cost 50,000
Total cost 2,050,000
Problem 15-29 Answer B
Present value of first note payable (500,000 x 5.65) 2,825,000
Present value of second note payable (3,000,000 x .80) 2,400,000
Total cost of machinery 5,225,000
Problem 15-30 Answer D
First payment on December 30, 2008 200,000
Present value of next 7 payments (200,000 x 4.712) 942,400
Total cost of machine 1,142,400
Another computation:
PV of annuity of 1 in advance for 8 periods (200,000 x 5.712) 1,142,400
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