Tek Enterprises uses a computer to handle its sales invoices. Lately, business has been so good that
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Tek Enterprises uses a computer to handle its sales invoices. Lately, business has been so good that it takes an extra 3 hours per night, plus every third Saturday, to keep up with the volume of sales invoices. Management is considering updating its computer with a faster model that would eliminate all of the overtime processing.
If sold now, the current machine would have a salvage value of $5,000. If operated for the remainder of its useful life, the current machine would have zero salvage value. The new machine is expected to have zero salvage value after 6 years.
Instructions
Should the current machine be replaced?
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Related Book For
Managerial Accounting Tools For Business Decision Making
ISBN: 9781118957738
7th International Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
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