Q: 17
An agricultural corporation that paid 53% in income tax wanted to build a grain elevator designed to
last twenty-five (25) years at a cost of $80,000 with no salvage value. Annual income generated
would be $22,500 and annual expenditures were to be $12,000.
Answer the question using a straight line depreciation and a 10% interest rate.
How many years will it take to earn $400 in interest on $800 at 4% compounded annually?
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