Michael's, Inc. is analyzing two machines to determine which one it should purchase (owning one of these machines is required by law). The company requires a 14% rate of return. Machine A has a cost of $290,000, annual after-tax operating costs of $8,000, and a 3-year life. Machine B costs $180,000, has annual after-tax operating costs of $12,000, and has a 2-year life. Whichever machine is purchased will be replaced at the end of its useful life. Which machine should Michael's purchase and why?

A.Machine A; because it will save the company about $8,600 a year

B.Machine A; because it will save the company about $132,912 a year

C.Machine B; because it will save the company about $200,000 a year

D.Machine B; because it will save the company about $11,600 a year

E.Machine B; because its equivalent annual cost is $199,759