On January 2, 2017, Zimbabwe Corp.purchases a new machine.The company makes a $3,000 cash down payment, and agrees to pay eight semi-annual instalments of $2,000 each, starting July 1, 2017, signing a non-interest bearing note to this effect.The cash equivalent price of the machine is not known, but the appropriate interest rate for this type of transaction is 8% p.a.Rounding to the nearest dollar (if necessary), Zimbabwe should record the cost of the machine at

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The cost of the machine is the present value of the payments. The down payment is $3,000. The present value of the eight $2,000 payments, discounted at 4% per period (8% annually, semi-annual compounding), is $12,413. Adding the down payment, the total cost is $15,413.