(Calculating EAC) Barry Boswell is a financial analyst for Dossman Metal Works, Inc. and he is analyzing two alternative configurations for the firm's new plasma cutter shop. The two alternatives, denoted A and B below, will perform the same task, but alternative A will cost $85,000 to purchase, while alternative B will cost only $60,000. Moreover, the two alternatives will have very different cash flows and useful lives. The after-tax costs for the two projects are as follows:

a. Calculate each project's EAC, given a discount rate of 11 percent. Alternative A's EAC at a discount rate of 11% is $(?). (Round to the nearest cent.)

b. Which of the alternatives do you think Barry should select? Why?

. X Data Table 3 Year Alternative A Alternative B 0 1 2 3 4 5 6 7 S(60,000) (4,000) (4,000) (4,000) S(85,000) (19,000) (19,000) (19,000) (19,000) (19,000) (19,000) (19,000) Print Done