Se straight-line depreciation to zero over the projects life

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You are evaluating two different silicon wafer milling machines. The Techron I costs $213,000, has a three-year life, and has pretax operating costs of $54,000 per year. The Techron II costs $375,000, has a five-year life, and has pretax operating costs of $27,000 per year. For both milling machines, use straight-line depreciation to zero over the project’s life and assume a salvage value of $31,000. If your tax rate is 30 percent and your discount rate is 9 percent, compute the EAC for both machines. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))

Reference no: EM13875397

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