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a company is considering replacing an existing machine with a new machine. based on the information below, should the company keep or replace the existing machine? existing machine new machine book value
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26 votes
26 votes
a company is considering replacing an existing machine with a new machine. based on the information below, should the company keep or replace the existing machine? existing machine new machine book value $ 35,000 purchase price $ 75,000 variable manufacturing costs per year $ 10,000 variable manufacturing costs per year $ 8,000 salvage value $ 0 selling price $ 40,000 remaining useful life 2 years useful life 5 years

User Roman Roman
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15 votes
15 votes

Answer: Keep the existing machine because the new machine will decrease overall income by $55,000

Step-by-step explanation:

User Bernita
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