2In preparing its first sinking fund plan, the owners corporation for a units plan

2 In preparing its first sinking fund plan, the owners corporation for a units plan of recently constructed townhouses estimates that the expected sinking fund expenditure for the units plan is $70 000 for the 10-year period of the plan, made up of $7 000 expected sinking fund expenditure for each financial year. Additionally, the owners corporation estimates that internal roads in the units plan will need resurfacing in 15 years time at an estimated cost of $120 000. The owners corporation decides it is necessary, in the first 10-year plan, to accumulate $80 000 to meet the expected sinking fund expenditure for the resurfacing. The owners corporation approves a total sinking fund contribution of $15 000 each year of the plan, made up of $7 000 to meet the expected sinking fund expenditure for each financial year and $8 000 to meet the expected sinking fund expenditure for the resurfacing.