Calculation present value and cash payment reduction

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Reference no: EM131185429

Please calculation the Present value and cash payment reduction. Instruction: Please show the clear calculation and interpretation.

Homework question 3: Company A sells machinery to Company B. Company B agrees to pay Company A $200,000 at the end of each of the next 5 years, with discount rate 7%. Instruction :

[1] provide a clear calculation for each year cash payment reduction for 6 years. (Do not roundof any amount. need 2 decimal after .)

[2] please provide an explanation toward your calculation

Reference no: EM131185429

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