Present Worth with Salvage Value of Equipment at 2nd Year Investment Calculator

✖Purchase Cost of Equipment refers to the total amount of money spent or required to acquire a specific piece of equipment.ⓘ Purchase Cost of Equipment [PE]			+10% -10%
✖Annuity is a financial product or arrangement that involves a series of periodic payments or receipts made at equal intervals.ⓘ Annuity [A]			+10% -10%
✖Interest Rate per Period represents the rate at which interest is charged or earned within a specific time frame.ⓘ Interest Rate per Period [i_r]			+10% -10%
✖Salvage Value of Equipment refers to the estimated residual or scrap value that an asset is expected to have at the end of its useful life or a specific period.ⓘ Salvage Value of Equipment [V_s]			+10% -10%

✖Present Worth is a financial metric that represents the current value of a series of future cash flows, considering the time value of money.ⓘ Present Worth with Salvage Value of Equipment at 2nd Year Investment [P_worth]

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Present Worth with Salvage Value of Equipment at 2nd Year Investment

Formula

`"P"_{"worth"} = "PE"-("A")/(1+"i"_{"r"})-("A")/(1+"i"_{"r"})^(2)+"V"_{"s"}`

Example

`"967611.6"="962000"-("1000")/(1+"0.06")-("1000")/(1+"0.06")^(2)+"7445"`

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Present Worth with Salvage Value of Equipment at 2nd Year Investment Solution

STEP 0: Pre-Calculation Summary

Formula Used

Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment
P_worth = PE-(A)/(1+i_r)-(A)/(1+i_r)^(2)+V_s
This formula uses 5 Variables

Variables Used

Present Worth - Present Worth is a financial metric that represents the current value of a series of future cash flows, considering the time value of money.
Purchase Cost of Equipment - Purchase Cost of Equipment refers to the total amount of money spent or required to acquire a specific piece of equipment.
Annuity - Annuity is a financial product or arrangement that involves a series of periodic payments or receipts made at equal intervals.
Interest Rate per Period - Interest Rate per Period represents the rate at which interest is charged or earned within a specific time frame.
Salvage Value of Equipment - Salvage Value of Equipment refers to the estimated residual or scrap value that an asset is expected to have at the end of its useful life or a specific period.

STEP 1: Convert Input(s) to Base Unit

Purchase Cost of Equipment: 962000 --> No Conversion Required
Annuity: 1000 --> No Conversion Required
Interest Rate per Period: 0.06 --> No Conversion Required
Salvage Value of Equipment: 7445 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

P_worth = PE-(A)/(1+i_r)-(A)/(1+i_r)^(2)+V_s --> 962000-(1000)/(1+0.06)-(1000)/(1+0.06)^(2)+7445

Evaluating ... ...

P_worth = 967611.607333571

STEP 3: Convert Result to Output's Unit

967611.607333571 --> No Conversion Required

FINAL ANSWER

967611.607333571 ≈ 967611.6 <-- Present Worth

(Calculation completed in 00.004 seconds)

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Home » Engineering » Chemical Engineering » Plant Design and Economics » Interest and Investment Costs » Present Worth with Salvage Value of Equipment at 2nd Year Investment

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< 9 Interest and Investment Costs Calculators

Present Worth of Annuity

Go Present Worth of an Annuity = Annuity*(((1+Discrete Compound Interest Rate)^(Number of Interest Periods)-1)/(Discrete Compound Interest Rate*(1+Discrete Compound Interest Rate)^(Number of Interest Periods)))

Present Worth with Salvage Value of Equipment at 2nd Year Investment

Go Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment

Future Worth of Perpetuity

Go Future Worth of a Perpetuity = Annuity*(((1+Discrete Compound Interest Rate)^(Number of Interest Periods)-1)/((Discrete Compound Interest Rate)))

Future Worth of Annuity

Go Future Worth of an Annuity = Annuity*(((1+Discrete Compound Interest Rate)^(Number of Interest Periods)-1)/(Discrete Compound Interest Rate))

Capitalized Cost

Go Capitalized Cost = Original Cost of Equipment+(Replacement Cost/((1+Discrete Compound Interest Rate)^(Number of Interest Periods)-1))

Future Worth of Annuity given Present Annuity

Go Future Worth of an Annuity = Present Worth of an Annuity*((1+Discrete Compound Interest Rate)^(Number of Interest Periods))

Present Worth for Initial Replacement

Go Present Worth = (Replacement Cost/((1+Interest Rate per Period)^(Number of Interest Periods)-1))

Replacement Cost

Go Replacement Cost = Original Cost of Equipment-Salvage Value of Equipment

Present Worth of Perpetuity

Go Present Worth of a Perpetuity = Annuity/Discrete Compound Interest Rate

Present Worth with Salvage Value of Equipment at 2nd Year Investment Formula

Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment
P_worth = PE-(A)/(1+i_r)-(A)/(1+i_r)^(2)+V_s

What is Salvage Value?

Salvage value, also known as scrap value or residual value, refers to the estimated amount that an asset can be sold for at the end of its useful life. It represents the remaining worth of an asset after it has been used for its intended purpose and has depreciated in value due to wear and tear, obsolescence, or other factors. Salvage value plays a crucial role in financial calculations, particularly when determining the depreciation expense of an asset. This helps businesses accurately reflect the declining value of their assets over time and estimate their true economic cost. Understanding salvage value also aids in decision-making regarding asset replacement and disposal, allowing companies to choose the most profitable course of action when it comes to managing their assets at the end of their useful lives.

How to Calculate Present Worth with Salvage Value of Equipment at 2nd Year Investment?

Present Worth with Salvage Value of Equipment at 2nd Year Investment calculator uses Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment to calculate the Present Worth, Present Worth with Salvage Value of Equipment at 2nd Year Investment is a financial metric that represents the current value of a series of cash flows associated with an equipment investment, taking into account the salvage value of the equipment at the end of its useful life. Present Worth is denoted by P_worth symbol.

How to calculate Present Worth with Salvage Value of Equipment at 2nd Year Investment using this online calculator? To use this online calculator for Present Worth with Salvage Value of Equipment at 2nd Year Investment, enter Purchase Cost of Equipment (PE), Annuity (A), Interest Rate per Period (i_r) & Salvage Value of Equipment (V_s) and hit the calculate button. Here is how the Present Worth with Salvage Value of Equipment at 2nd Year Investment calculation can be explained with given input values -> 967611.6 = 962000-(1000)/(1+0.06)-(1000)/(1+0.06)^(2)+7445.

FAQ

What is Present Worth with Salvage Value of Equipment at 2nd Year Investment?

Present Worth with Salvage Value of Equipment at 2nd Year Investment is a financial metric that represents the current value of a series of cash flows associated with an equipment investment, taking into account the salvage value of the equipment at the end of its useful life and is represented as P_worth = PE-(A)/(1+i_r)-(A)/(1+i_r)^(2)+V_s or Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment. Purchase Cost of Equipment refers to the total amount of money spent or required to acquire a specific piece of equipment, Annuity is a financial product or arrangement that involves a series of periodic payments or receipts made at equal intervals, Interest Rate per Period represents the rate at which interest is charged or earned within a specific time frame & Salvage Value of Equipment refers to the estimated residual or scrap value that an asset is expected to have at the end of its useful life or a specific period.

How to calculate Present Worth with Salvage Value of Equipment at 2nd Year Investment?

Present Worth with Salvage Value of Equipment at 2nd Year Investment is a financial metric that represents the current value of a series of cash flows associated with an equipment investment, taking into account the salvage value of the equipment at the end of its useful life is calculated using Present Worth = Purchase Cost of Equipment-(Annuity)/(1+Interest Rate per Period)-(Annuity)/(1+Interest Rate per Period)^(2)+Salvage Value of Equipment. To calculate Present Worth with Salvage Value of Equipment at 2nd Year Investment, you need Purchase Cost of Equipment (PE), Annuity (A), Interest Rate per Period (i_r) & Salvage Value of Equipment (V_s). With our tool, you need to enter the respective value for Purchase Cost of Equipment, Annuity, Interest Rate per Period & Salvage Value of Equipment and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

How many ways are there to calculate Present Worth?

In this formula, Present Worth uses Purchase Cost of Equipment, Annuity, Interest Rate per Period & Salvage Value of Equipment. We can use 1 other way(s) to calculate the same, which is/are as follows -

Present Worth = (Replacement Cost/((1+Interest Rate per Period)^(Number of Interest Periods)-1))

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