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Oakville aqua club bought swimming equipment on a contract requiring monthly payments of $ 1300 for...

Oakville aqua club bought swimming equipment on a contract requiring monthly payments of $ 1300 for 5 years beginning 6 months after the date of purchase. What was the cash value of the equipment if interest is 10.5% compounded monthly

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Answer #1
This is two step problem
First we have to compute the present value at 6th month
put in calculator
FV 0
PMT -1300
I 10.5%/12 0.875%
N 5*12 60.0
compute PV $60,482.28
Step - 2
Computation of present value today
Present value = $57,401.97
60482.28/(1+0.875%)^6
Ans = $57,401.97
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