Pev June 09

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sunshine2010
sunshine2010 Registered Posts: 45 Regular contributor ⭐
in AAT Level 4 (Level 8 in Scotland)
Pev June 09 help please with section 2.2

The discounted cashflow for purchasing the machine
I got the correct answer for leasing but not purchasing can anyone explain how they got the final answer of 514600 ?

Thanks ;(

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  • EAP
    EAP Registered Posts: 63 Regular contributor ⭐
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    Did you forget the residual value of £200,000? - this meant the last year cost was actually -160,000
    Alternatively - maybe you put the purchase price and running costs in year 0? Only purchase price goes here
    does this help?
  • sunshine2010
    sunshine2010 Registered Posts: 45 Regular contributor ⭐
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    Ahh I get it, I had taken the first 40000 at the full price and nit present value oops thanks ;)

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