4. Problem 12.06 (Depreciation Methods) eBook Charlene is evaluating a capital budgeting project that should last for 4 years. The project requires $900,000 of equipment and is eligible for 100% bonus depreciation. She is unsure whether immediately expensing the equipment or using straight-line depreciation is better for the analysis. Under straight-line depreciation, the cost of the equipment would be depreciated evenly over its 4-year life (ignore the half-year convention for the straight-line method). The company's WACC is 10%, and its tax rate is 20%. a. What would the depreciation expense be each year under each method? Enter your answers as positive values. Round your answers to the nearest dollar. Year Scenario 1 Scenario 2 (Bonus Depreciation) (Straight-Line) 0 $ $ 1 $ $ $ 2 $ 3 $ $ 4 $ $ b. Which depreciation method would produce the higher NPV? -Select- V How much higher would the NPV be under the preferred method? Do not round intermediate calculations. Round your answer to the nearest dollar. $ Faleye Consulting is deciding which of two computer systems to purchase. It can purchase state-of-the-art equipment (System A) for an after-tax cost of $21,000, which will generate after-tax cash flows of $6,000 at the end of each of the next 6 years. Alternatively, the company can purchase equipment with an after-tax cost of $14,000 that can be used for 3 years and will generate after-tax cash flows of $6,000 at the end of each year (System B). If the company's WACC is 10% and both "projects" can be repeated indefinitely, which system should be chosen, and what is its EAA? Do not round intermediate calculations. Round your answer to the nearest cent. Choose Project -Select- V, whose EAA = $