The equipment below is required for your business. Assume each will be replaced as it wears out.
Fantastic news! We've Found the answer you've been seeking!
Question:
The equipment below is required for your business. Assume each will be replaced as it wears out. The required return is 15%. Ignore taxes.
Machine A
Machine B
Initial cost
$200,000
$300,000
Operating Cost/year
15,000
17,500
Life
8 yrs
10 yrs
What is the equivalent annual cost (EAC) of machine A?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date: