Answer Happy

Rory Company has an old machine with a book value of $85,000 and a remaining five-year useful life. Rory is considering purchasing a new machine at a price of $112,000, Rory can sell its old machine now for $74.000 The old machine has variable manufacturing costs of $42,000 per year. The new machine will reduce variable manufacturing costs by $16,800 per year over its five-year useful life (a) Prepare a keep or replace analysis of income effects for the machines (b) Should the old machine be replaced? Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a keep or replace analysis of income effects for the machines. Keep Replace Income Increase (Decrease) if replaced Keep or Replace Analysis Revenues
Required A Required B Prepare a keep or replace analysis of income effects for the machines. Keep Replace Income Increase (Decrease) if replaced $ 0 74,000 + Keep or Replace Analysis Revenues Sale of existing machine Costs Purchase of new machine Variable manufacturing costs Income (loss) S 112,000 S 35,000 < Requiroda Required B >