Evaluating two different silicon wafer milling machines

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Reference no: EM13980785

You are evaluating two different silicon wafer milling machines. The Techron I costs $249,000, has a three-year life, and has pretax operating costs of $66,000 per year. The Techron II costs $435,000, has a five-year life, and has pretax operating costs of $39,000 per year. For both milling machines, use straight-line depreciation to zero over the project’s life and assume a salvage value of $43,000. If your tax rate is 35 percent and your discount rate is 10 percent, compute the EAC for both machines.

Reference no: EM13980785

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