Calculate the eac for each copier

Reference no: EM132022924

Question: Office Automation, Inc., must choose between two copiers, the XX40 or the RH45. The XX40 costs $2, 400 and will last for 5 years. The copier will require a real aftertax cost of $270 per year after all relevant expenses. The RH45 costs $2, 900 and will last 7 years. The real aftertax cost for the RH45 will be $245 per year. All cash flows occur at the end of the year. The inflation rate is expected to be 6 percent per year, and the nominal discount rate is 12 percent. Calculate the EAC for each copier. (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.)

Reference no: EM132022924

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