The math department also purchased a printer. after 4 years, it will have a salvage value of $200. a new printer is expected to cost $2000. the department established a sinking fund in order to provide money for the difference between the cost and the salvage value. if the fund earns 6% compounded semiannually, determine the size of payments.

determine the size of payments.

$202,42

Explanation:

Expected cost              2000

Salvage value old printer200

         Cost requirement        1800

FVOrdinary Annuity=C*(1+i)n-1/i  

1800=c*(1+3%)>8-1/i  

C=202,42  

NMonthly            %VF

0202,42149991,00202,42

1202,42149991,06214,57

2202,42149991,12227,44

3202,42149991,19241,09

4202,42149991,26255,55

5202,42149991,34270,89

6202,42149991,42287,14

7202,42149991,50304,37