$($Related to Checkpoint $11\mathrm{.}2)($Calculating EAC$)$ Barry Boswell is a financial analyst for Dossman Metal Works, Inc.

and he is analyzing two alternative configurations for the firm's new plasma cutter shop. The two alternatives,

denoted A and $B$ below, will perform the same task, but alternative A will cost $$75,000$ to purchase, while alternative $B$

will cost only $$60,000.$ Moreover, the two alternatives will have very different cash flows and useful lives. The after$-$tax

costs for the two projects are as follows: $.$

a$.$ Calculate each project's EAC, given a discount rate of $11$ percent.

b$.$ Which of the alternatives do you think Barry should select? Why?

a$.$ Alternative A$\text{'}$s EAC at a discount rate of $11\%$ is $$.($Round to the nearest cent.$)$