Question: How do I calculate the EAC? The Techron I costs $214,000, has a 3-year life, and has pretax operating costs of $37,000 per year. The

How do I calculate the EAC?

The Techron I costs $214,000, has a 3-year life, and has pretax operating costs of $37,000 per year. The Techron II costs $328,000, has a 6-year life, and has pretax operating costs of $22,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $20,000. If your tax rate is 35 percent and your discount rate is 16 percent. The Techron I EACis $_____ , while the Techron II has an EAC of $______

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