Calculate cash price of the asset Rs.2000 To paid on signing the agreement 2800 At the end of 1st year 2600 Second year 2400 At end of the third year 2200at the end of the forth year interest is charged at the rate of 10% P.a
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Hi Sunil
Cash price of asset is 10000 calculated as follows
Year
Amount to be paid
Discounting Factor
Discounted Value (Amt*Discounting factor)
0
2000
1.00
2000
1
2800
0.91
2545
2
2600
0.83
2149
3
2400
0.75
1803
4
2200
0.68
1503
Total
10000
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Answer the question...
Hi Sunil
Cash price of asset is 10000 calculated as follows
| Year | Amount to be paid | Discounting Factor | Discounted Value (Amt*Discounting factor) |
| 0 | 2000 | 1.00 | 2000 |
| 1 | 2800 | 0.91 | 2545 |
| 2 | 2600 | 0.83 | 2149 |
| 3 | 2400 | 0.75 | 1803 |
| 4 | 2200 | 0.68 | 1503 |
| Total | 10000 |
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