Question: Eads Industrial Systems Company (EISC) is trying to decide between two different conveyor belt systems. System A costs $257,000, has a five-year life, and requires
Eads Industrial Systems Company (EISC) is trying to decide between two different conveyor belt systems. System A costs $257,000, has a five-year life, and requires $113,000 in pretax annual operating costs. System B costs $830,000, has a seven-year life, and requires $120,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have a zero salvage value. Whichever system is chosen, it will not be replaced when it wears out. The tax rate is 21 percent and the discount rate is 6 percent. What is the NPV of the project you should accept? Round to the nearest dollar
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