Letang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $310,000, has a four-year life, and requires $109,000 in pretax annual operating costs. System B costs $390,000, has a six-year life, and requires $103,000 in pretax annual operating costs. Suppose the company always needs a conveyor belt system; when one wears out, it must be replaced. Assume the tax rate is 24 percent and the discount rate is 8 percent.

Calculate the EAC for both conveyor belt systems. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

$ System A System B 176,435.45 679,762.10 $ Which conveyor belt system should the firm choose? System B System A