Capstone C7 with answers

Capstone C7 with answers - ADM2340 Introductory Financial...

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ADM2340 Introductory Financial Accounting Capstone Problem Chapter 7 Patti’s Pirate Adventures is a company that specializes in extravagant birthday parties and special events on the water in a three-masted sailing vessel. They have 1 ship already, but they are looking at buying two new boats that have a more authentic look than the one they currently have. The original boat was purchased for $250,000 and has a current net book balue of $70,000. It was anticipated that it would last 20 years and has been amortized $10,000 per year. The two new ships will cost $500,000 each and Patti is planning to upgrade one of the ships with some extra features for $150,000. Patti will need to pay 13% HST on the purchase. A bank loan of $750,000 will be used along with cash and the trade-in of the original boat for the purchase. Required: a) How long ago was the original boat purchased? What residual value did they expect when they purchased it? Formulas:
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Capstone C7 with answers - ADM2340 Introductory Financial...

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