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A new bottle - capping machine costs 6 9 , 0 0 0 , including 7 , 0 0 0 for installation. The machine is

A new bottle-capping machine costs 69,000, including 7,000 for installation. The machine is expected to have a useful life of eight years with no salvage value at that time (assume straight-line depreciation). Operating and maintenace costs are expected to be 5,000 for the first year, increasing by 1,500 each year thereafter. Interest is 10%.
Construct a spreadsheet that has the following headings: Year, Salvage Value, Maintenance Costs, EAC (Capital Costs), EAC (Operating Costs), and EAC (Total Costs). Compute the EAC (Total Costs) if the bottle capper is kept for n years, n =1,...,8.
What is the economic life of the bottle capper (in years)?

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