Question
You are evaluating two different silicon wafer milling machines. The Techron I cost $294,000, has a 3-year life, and has pretax operating costs of $81,000
You are evaluating two different silicon wafer milling machines. The Techron I cost $294,000, has a 3-year life, and has pretax operating costs of $81,000 per year. The Techron II costs $510,000, has a 5-year life, and has pretax operating costs of $48,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $58,000. If your tax rate is 22 percent and your discount rate is 10 percent, compute the EAC for both machines.(A negative answershould be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
Which machine do you prefer?Techron II or Techron I
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