Problem 10.21

You are trying to choose between purchasing one of two machines for a factory. Machine A costs $15,500 to purchase and has a three-year life. Machine B costs $17,400 to purchase but has a four-year life. Regardless of which machine you purchase, it will have to be replaced at the end of its operating life. Which machine should you choose? Assume a marginal tax rate of 35 percent and a discount rate of 15 percent. (Round answers to 2 decimal places, e.g. 15.25.)

Equivalent Annual Cost (EAC) of machine A
Equivalent Annual Cost (EAC) of machine B

2:

Problem 10.17 (Part Level Submission) Given the U.S. Corporate Tax Rate Schedule shown below, and a corporation that generates a taxable income of $10,600,000 in 2012,

(a)

	Your answer is correct.

What is the marginal tax rate?

Marginal tax rate

%

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(b)

What is the average tax rate? (Round answer to 2 decimal places, e.g. 17.54%.)

Average tax rate

%