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27 February, 21:48

Brainstorm Company purchased office furniture and equipment for $20,000 and agreed to pay for the purchase by making six annual installment payments beginning one year from today. The installment payments include interest at 6%. What is the required annual installment payment?

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  1. 27 February, 22:09
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    The required annual installment payment is $4067.25.

    Explanation:

    annual installment = (20000*6%) / (1 - (1 + 6%) ^6)

    = $4067.25

    Therefore, the required annual installment payment is $4067.25.
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