Question

You are evaluating two different silicon wafer milling
machines. The Techron I costs $270,000, has a three-year life, and
has pretax operating costs of $73,000 per year. The Techron II
costs $470,000, has a five-year life, and has pretax operating
costs of $46,000 per year. For both milling machines, use
straight-line depreciation to zero over the project’s life and
assume a salvage value of $50,000. If your tax rate is 25 percent
and your discount rate is 9 percent, compute the EAC for both
machines. (Your answer should be a
negative value and indicated by a minus sign. Do
not round intermediate calculations and round your answers to 2
decimal places, e.g., 32.16.) |

Answer #1

You are evaluating two different silicon wafer milling machines.
The Techron I cost $270,000, has a 3-year life, and has pretax
operating costs of $73,000 per year. The Techron II costs $470,000,
has a 5-year life, and has pretax operating costs of $46,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $50,000.
If your tax rate is 24 percent and your discount rate is 10
percent, compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $258,000, has a three-year life, and has pretax
operating costs of $69,000 per year. The Techron II costs $450,000,
has a five-year life, and has pretax operating costs of $42,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $46,000.
If your tax rate is 25 percent and your discount rate is 10
percent, compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $258,000, has a 3-year life, and has pretax
operating costs of $69,000 per year. The Techron II costs $450,000,
has a 5-year life, and has pretax operating costs of $42,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $46,000.
If your tax rate is 25 percent and your discount rate is 10
percent, compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $258,000, has a three-year life, and has pretax
operating costs of $69,000 per year. The Techron II costs $450,000,
has a five-year life, and has pretax operating costs of $42,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $46,000.
If your tax rate is 21 percent and your discount rate is 9 percent,
compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $258,000, has a three-year life, and has pretax
operating costs of $46,800 per year. The Techron II costs $350,000,
has a five-year life, and has pretax operating costs of $54,900 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $29,000.
Assume the tax rate is 40 percent and the discount rate is 12
percent.
...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $261,000, has a three-year life, and has pretax
operating costs of $70,000 per year. The Techron II costs $455,000,
has a five-year life, and has pretax operating costs of $43,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $47,000.
If your tax rate is 35 percent and your discount rate is 9 percent,
compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $249,000, has a three-year life, and has pretax
operating costs of $66,000 per year. The Techron II costs $435,000,
has a five-year life, and has pretax operating costs of $39,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $43,000.
If your tax rate is 23 percent and your discount rate is 10
percent, compute...

You are evaluating two different silicon wafer milling
machines. The Techron I costs $219,000, has a three-year life, and
has pretax operating costs of $56,000 per year. The Techron II
costs $385,000, has a five-year life, and has pretax operating
costs of $29,000 per year. For both milling machines, use
straight-line depreciation to zero over the project’s life and
assume a salvage value of $33,000. If your tax rate is 22 percent
and your discount rate is 8 percent, compute...

You are evaluating two different silicon wafer milling machines.
The Techron I costs $246,000, has a three-year life, and has pretax
operating costs of $65,000 per year. The Techron II costs $430,000,
has a five-year life, and has pretax operating costs of $38,000 per
year. For both milling machines, use straight-line depreciation to
zero over the project’s life and assume a salvage value of $42,000.
If your tax rate is 22 percent and your discount rate is 8 percent,
compute...

You are evaluating two different silicon wafer milling
machines. The Techron I costs $228,000, has a three-year life, and
has pretax operating costs of $59,000 per year. The Techron II
costs $400,000, has a five-year life, and has pretax operating
costs of $32,000 per year. For both milling machines, use
straight-line depreciation to zero over the project’s life and
assume a salvage value of $36,000. If your tax rate is 24 percent
and your discount rate is 8 percent, compute...

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