Asset Replacement An uninsured boat costing $91,400 was wrecked the first day it was used. It...

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Asset Replacement An uninsured boat costing $91,400 was wrecked the first day it was used. It can be either sold as-is for $9,140 cash and replaced with a similar boat costing $94,100 or rebuilt for $76,400 and be brand new as far as operating characteristics and looks are concerned. Required: What is the difference in cost between the two options? Difference in cost Based on financial considerations, what should the company do? Sell as-is for $9,140 cash and replace with a similar boat costing $94,100. Rebuild for $76,400. Asset Replacement An uninsured boat costing $91,400 was wrecked the first day it was used. It can be either sold as-is for $9,140 cash and replaced with a similar boat costing $94,100 or rebuilt for $76,400 and be brand new as far as operating characteristics and looks are concerned. Required: What is the difference in cost between the two options? Difference in cost Based on financial considerations, what should the company do? Sell as-is for $9,140 cash and replace with a similar boat costing $94,100. Rebuild for $76,400.

Answer rating: 100% (QA)

1 Particulars Amount Replacement cost 94100 Less Sale price 9140 Total ... View the full answer