Service Provider will fund an investment in a new dorm building in the amount of Ten...

Service Provider will fund an investment in a new dorm building in the amount of Ten Million Dollars ($10,000,000). The investment will be amortized over a period of fifteen (15) years from the date of disbursement calculated at a rate equal to a straight-line basis. If the agreement is terminated prior to the full amortization of the investment, then the client is liable for and promises to pay Service Provider within thirty (30) days of the termination notice date the unamortized portion of the Investment.

Calculate the first month amortization expense for the investment.

Expert Solution

The first month's amortization expense for the investment would be = Cost of new dorm building / Life period or amortisation period in months

first month's amortization expense for the investment = $10,000,000 / 15*12 = $55555.56

ekkarill92 answered 2 years ago

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