PROPOSED PROBLEMS

1. A machine has a value of $60,000 and must depreciate to $5,000 in 8 years. Find the fixed percentage.
of depreciation and make the depreciation table.

Certain machinery of a company has a cost of $10,000 and an estimated useful life of 5 years. If the
The salvage value corresponds to 10% of the initial cost. Find the annual depreciation and construct the chart of
depreciation. Use the sum of the digits.

A police department acquires new patrol cars worth $250,000 each. It estimates that their lifespan
The useful life will be 5 years, after which its salvage value will be zero.
A) Determine the annual depreciation using the fixed percentage method.
b) Prepare the depreciation table.

4. Calculate the price that can be paid for a coal mine that produces an income of $600,000 annually.
If the engineers estimate that maintaining the level of exploitation would lead to depletion in 15 years and the investors
They wish to obtain an 8% interest on the investment, considering that a 4% interest can be obtained.
about the investment recovery fund.

5. An oil field may provide a net profit of $5,000,000 annually for 10 years. Calculate the value.
of the shares that may be issued, if a nominal dividend of 12% is offered with quarterly payments and can
Obtain an interest of 4% on the investment recovery fund.

6. Certain technological equipment of a company has an initial cost of $35,000 and an estimated useful life of 7.
years. If the salvage value is equal to three times the annual depreciation. If the company uses the method of the
straight line. Calculate the salvage value.
$10,500

7. Certain equipment of a company has an initial cost of $32,000, and an estimated useful life of 8 years. If the
The salvage value corresponds to 15% of the initial cost. Calculate the annual savings that the company would gain if
instead of applying the straight-line method, the amortization fund method will be applied at a rate of 10%.
annual. Response: $1,021.52;

8. A machine has an initial cost of $80,000; the salvage value is 10% of the initial cost, and a
Useful life of 10 years. Find the book value in the fifth year. (Fixed percentage method)
$25,298.22

9. What is the annual depreciation of a computer that cost C$30,000, assuming it will be in service
2,920 hours each year, for 5 years and in the end, recover C$800?
$5,840

A gypsum mine can be exploited for 10 years with a net profit of $3,000,000 annually.
It is expected that after the exploitation ends, there will be recoverable assets worth $500,000. Calculate the
performance that a buyer who paid $15,000,000 for the mine will have on their investment. The fund of
Refund accumulates at 10% per year.
14.53%; $10.50%; $11.85%; 13.93%; N.A
10. Certain equipment of a company has an initial cost of $25,000, and an estimated useful life of 10 years. If
The salvage value corresponds to 20% of the initial cost. a) Calculate the annual depreciation b) make the
depreciation schedule.

11. A machine has an initial cost of C$250,000, a useful life of 6 years and a salvage value
of C$50,000. Prepare a depreciation schedule, applying the sinking fund method to the
8% rate.

12. 3. A certain technological equipment from a company has an initial cost of $35,000 and an estimated useful life of
7 years. If the salvage value is equal to triple the annual depreciation. If the company uses the
straight line method. Calculate the salvage value. Answer: $10,500

A certain piece of equipment from a company has an initial cost of $32,000 and an estimated useful life of 8 years. If
the salvage value corresponds to 15% of the initial cost. Calculate the annual savings that would be gained.
company, if instead of applying the straight-line method it applied the sinking fund method to
the 10% annual rate. $1,021.52

14. A gypsum mine can be operated for 10 years with a net profit of $3,000,000 annually. It
It is anticipated that, upon the end of the exploitation, there will be recoverable assets worth $500,000. Calculate the
return on investment that a buyer who paid $15,000,000 for the mine will have. The fund of
refund accumulates at 10% per year.
13.93%;

15. Calculate the net depreciation in the fourth year, of the 6 years of useful life, for a machine that cost
$168,000 is ultimately sold for $75,000, it depreciates at a rate of 13% annually and its value increases with the
0.8% monthly inflation on average. Create the table.

16. An oil field may yield a profit of $4,000,000 annually for 6 years. Calculate the value of the
actions that could be issued, if a nominal dividend of 24% is offered with quarterly payments and
You can obtain an interest of 15% compounded bi-monthly on the recovery fund of the
investment. The salvage value is $1,200,000 dollars.

17. Calculate the annual depreciations of a tractor that cost $325,000, the first year it works for
3000 hours and in the following years it decreases by 2% each year, of the 6 years it has of useful life. Assume
which in the end sells for 20% of what it cost. Make the depreciation table.

18. (Production unit method) the production of spare parts for a car from a team that
It cost $425,000 dollars, in its 6 years of useful life it is the following in hundreds of pieces

years production
1 20,000
2 19,325
3 19,050
4 18,595
5 16,923
6 15,097

a) How much is depreciated in the fourth year if the salvage value is $103,385?
b) Make the depreciation table.
 PROPOSED EXERCISES bonds
How much is a bond with a nominal value of $100 that is redeemed at par negotiated for?

How much does an investor pay for a bond with a nominal value of $200, redeemed at 115, and purchased at
90 with a discount?
How much is paid for a $60 bond if it is purchased at 110 and redeemed at a discount of 98?

Ifan obligation is redeemed at 108 and its nominal value is $200, how much will the issuer pay?
investor upon deadline expiration?
How much will the issuer pay at the end of the term for a bond with a nominal value of $120, if it
redeem to 98?

What is the redemption value of a bond with a face value of $300 if it is redeemed at 103?

7 What is the buying and selling value of a bond that is redeemed at 112, has a nominal value of
$300 and is purchased at 92?

8 How much is a bond that is redeemed at 97, has a nominal value of $100, and is bought for?
105?

Value of the bonds sale

9 The Licorera SA company issues bonds with a nominal value of $200 paying interest of 33%.
annual with coupons that expire on the fifteenth day of the months of January, May, and September of
every year. What is the price of each bond on May 15, 2002, if it is redeemed on the 15th of
September 2009 and a return of 42% annual compounded per quarter is expected?

10What is the selling price of a $200 bond, 6 years before its redemption, if the issuer
pays interest on semiannual coupons of $54 and aims for a return of 36% per year
capitalizable per semester?

11 Three years ago, the Central Bank placed a bond issuance worth 500 in the stock market.
millions of dollars that are redeemed at 103 with a term of 6 years. What is the buying and selling price?
today, if an annual return of 32% compounded semi-annually is intended? Assume that the
the issuance was 2.5 million bonds and pays interest of 29.1% annually in coupons
semesterly.