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Jackson & Sons uses packing machines to prepare its products for shipping. They need to...

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Finance

Jackson & Sons uses packing machines to prepare its products for shipping. They need to replace their primary packing machine and are considering two different options.

Machine 1 costs $409,500 and lasts 4 years before it needs replaced. The annual aftertax operating cost for the machine is $34,900.

Machine 2 costs $536,300 and should last for 6 years. It has an annual aftertax operating cost of $23,000.

What is the equivalent annual cost of each machine if the required return is 19 percent?

EAC for Machine 1 =

EAC for Machine 2 =

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