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You are evaluating two different silicon wafer milling machines. The Techron I costs $267,000, has a...

You are evaluating two different silicon wafer milling machines. The Techron I costs $267,000, has a 3-year life, and has pretax operating costs of $72,000 per year. The Techron II costs $465,000, has a 5-year life, and has pretax operating costs of $45,000 per year. For both milling machines, use straight-line depreciation to zero over the project’s life and assume a salvage value of $49,000. If your tax rate is 23 percent and your discount rate is 13 percent, compute the EAC for both machines.

Techron I

Techron II

Which machine do you prefer?

Techron I

Techron II

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

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