You are evaluating two different silicon wafer milling machines. The Techron I costs $255,000, has a...

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You are evaluating two different silicon wafer milling machines.The Techron I costs $255,000, has a 3-year life, and has pretaxoperating costs of $68,000 per year. The Techron II costs $445,000,has a 5-year life, and has pretax operating costs of $41,000 peryear. For both milling machines, use straight-line depreciation tozero over the project’s life and assume a salvage value of $45,000.If your tax rate is 24 percent and your discount rate is 13percent, compute the EAC for both machines. (A negativeanswer should be indicated by a minus sign. Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
Techron I EAC:
Teachron II EAC:
Which machine do you prefer?
Techron I
Techron II

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You are evaluating two different silicon wafer milling machines.The Techron I costs $255,000, has a 3-year life, and has pretaxoperating costs of $68,000 per year. The Techron II costs $445,000,has a 5-year life, and has pretax operating costs of $41,000 peryear. For both milling machines, use straight-line depreciation tozero over the project’s life and assume a salvage value of $45,000.If your tax rate is 24 percent and your discount rate is 13percent, compute the EAC for both machines. (A negativeanswer should be indicated by a minus sign. Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)Techron I EAC:Teachron II EAC:Which machine do you prefer?Techron ITechron II