Two alternative machines will produce the same product, but one is capable of higher-quality work, which can be expected to return greater revenue. The following are relevant data:

Determine which is the better alternative, assuming repeatability and using SL depreciation, an income-tax rate of 40%, and an after-tax MARR of 10%.

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Capital investment Life Terminal BV (and MV) Annual receipts Annual expenses Machine A Machine B $20,000 $30,000 12 years 8 years $150,000 $188,000 $138,000 $170,000 $4,000 50