Problem
New Tech has decided to redesign its open office areas. It has decided to install workstation cubicles for each engineer. These cubicles are classed as built-in furniture and cost $2000 each. The 11 cubicles will last 15 years, with maintenance costs of $75 per year. Assume that the cubicles have $0 salvage values. Assume MACRS and the current tax law. The corporation's taxable income places it in the top federal income tax bracket. New Tech's interest rate is 9%.
(a) Find the EAC for each cubicle.
(b) Find the after-tax cash flows for years 0 through 15.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.