A machine with a book value of $82,500 has an estimated five-year life, A proposal is...

 

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A machine with a book value of $82,500 has an estimated five-year life, A proposal is offered to sell the old machine for $48,000 and replace it with a new machine at a cost of $72,000. The new machine has a five-year life with no residual value. The new machine would reduce annual direct labor costs from $10,300 to $8,300. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet a. Prepare a differential analysis dated June 2 on whether to continue with the old machine (Alternative 1) or replace the old machine (Alternative 2). If an amount is zero, enter "0". Use a minus sign to indicate costs, losses, or negative differential effect on income. Revenues: Proceeds from sale of old machine Costs: Purchase price. Direct labor (5 years) Differential Analysis Continue (Alt. 1) or Replace (Alt. 2) Old Machine June 2 Continue with Old Machine. (Alternative 1) Profit (Loss) Replace Old Machine (Alternative 2) Differential Effects (Alternative 2) A machine with a book value of $82,500 has an estimated five-year life, A proposal is offered to sell the old machine for $48,000 and replace it with a new machine at a cost of $72,000. The new machine has a five-year life with no residual value. The new machine would reduce annual direct labor costs from $10,300 to $8,300. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet a. Prepare a differential analysis dated June 2 on whether to continue with the old machine (Alternative 1) or replace the old machine (Alternative 2). If an amount is zero, enter "0". Use a minus sign to indicate costs, losses, or negative differential effect on income. Revenues: Proceeds from sale of old machine Costs: Purchase price. Direct labor (5 years) Differential Analysis Continue (Alt. 1) or Replace (Alt. 2) Old Machine June 2 Continue with Old Machine. (Alternative 1) Profit (Loss) Replace Old Machine (Alternative 2) Differential Effects (Alternative 2)

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Differential Income or Loss can be calculated by formula Differential Revenue Differential Cost Le... View the full answer