Elias wants to perform an after-tax evaluation of equivalent methods A and B to electro statically remove airborne particulate matter from clean rooms used to package liquid pharmaceutical products. Using the information shown, MACRS depreciation with n = 3 years, a 5-year study period, after-tax MARR = 7% per year, and Te = 34% and a spreadsheet, he obtained the results AWA = $−2176 and AWB = $3545. Any tax effects when the equipment is salvaged were neglected. Thus, with MACRS depreciation, method B is the better method. Now, use classical SL depreciation with n = 5 years to evaluate the alternatives. Is the decision different from that reached usingMACRS?

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Method A Method B First cost, $ Salvage value, $ Savings, S per year AOC, $ per year Expected life, years -100,000 10,000 35,000 -15,000 -150,000 20,000 45,000 -6,000