Sunbury Company is considering the replacement of a machine that is presently used in production. The following data are available: Old Machine New Machine Original cost $60,000 $35,000 Useful life in years 10 5 Current age in years 5 0 Book value $25,000 – Disposal value now $8,000 – Disposal value in 5 years 0 0 Annual cash operating costs $12,000 $4,000 Adding all five years together, the total relevant costs to consider if the old machine is kept are ________.

A) $30,000
B) $50,000
C) $52,000
D) $60,000

Answer rating: 100% (QA)

Annual cash operating costs of old machine 12000 Tota... View the full answer