Enter the initial cost (\$), the maintenance cost (\$), and the interest rate (%) into the Capitalized Cost Calculator. The calculator will evaluate and display the Capitalized Cost.

## Capitalized Cost Formula

The following formula is used to calculate the Capitalized Cost.

CC = IC + MC*(1/(R/100))

• Where CC is the Capitalized Cost (\$)
• IC is the initial cost (\$)
• MC is the maintenance cost (\$)
• R is the interest rate (%)

## How to Calculate Capitalized Cost?

The following example problems outline how to calculate Capitalized Cost.

Example Problem #1

1. First, determine the initial cost (\$). The initial cost (\$) is given as 200,000 .
2. Next, determine the maintenance cost (\$). The maintenance cost (\$) is calculated as  40,000 .
3. Next, determine the interest rate (%). The interest rate (%) is found to be 15.
4. Finally, calculate the Capitalized Cost using the formula above:

CC = IC + MC*(1/(R/100))

Inserting the values from above yields:

CC = 200000 + 40000*(1/(15/100)) = (\$) 466,666.66

Example Problem #2

The variables needed for this problem are provided below:

initial cost (\$) = 4000

maintenance cost (\$) = 2000

interest rate (%) = 10

Entering these values and solving gives:

CC = IC + MC*(1/(R/100)) = (\$) 24,000