You are evaluating two different silicon wafer milling machines. The Techron I costs $285,000, has a 3-year life, and has pretax operating costs of $78,000 per year. The Techron II costs $495,000, has a 5-year life, and has pretax operating costs of $45,000 per year. For both milling machines, use straight-line depreciation to zero over the projects life and assume a salvage value of $55,000. If your tax rate is 24 percent and your discount rate is 11 percent, compute the EAC for both machines. (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.)

Techron 1:

Techron 2:

Which machine do you prefer?

Techron I Techron II