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Phantasy [73]
2 years ago
9

Machine Replacement Decision A company is considering replacing an old piece of machinery, which cost $400,000 and has $175,000

of accumulated depreciation to date, with a new machine that has a purchase price of $550,000. The old machine could be sold for $250,000. The annual variable production costs associated with the old machine are estimated to be $72,500 per year for eight years. The annual variable production costs for the new machine are estimated to be $24,000 per year for eight years. a.1 Prepare a differential analysis dated May 29 to determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss.
Business
1 answer:
jenyasd209 [6]2 years ago
6 0

Answer:

Decision : It would be better to Replace Old Machine

Explanation:

Check the file attached for proper arrangement and explanation of the solution. Thank you.

Download docx
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The BVM Corp., construction company, purchased a used hybrid electric pickup truck for 30,000 and used MACRS depreciation in the
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Answer:

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Explanation:

a) Calculations:

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b) MACRS means the modified accelerated cost recovery system.  It is an allowance by the IRS for faster depreciation in the first years of an asset's life and the depreciation slows later on in order to allow a business to recover the cost basis of certain assets that deteriorate over time.

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Answer:

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Explanation:

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Answer:

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The journal entry is shown below:

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