Food Process Ltd$.$ purchased a machine for

$ $100$ comma $000$$$100,000.$

Current accumulated amortization totals

$ $40$ comma $000$$$40,000.$

Management is contemplating the purchase of a new machine for

$ $120$ comma $000$$$120,000.$

Current disposal of the old machine would cost

$ $65$ comma $000$$$65,000.$

What is the correct category for each$$ item?

Question content area bottom

Part $1$

A$.$

$$Irrelevant:

$ $100$ comma $000$$$100,000$

cost of old$$ machine,

$ $40$ comma $000$$$40,000$

accumulated amortization

$$Relevant:

$ $120$ comma $000$$$120,000$

cost of new$$ machine,

$ $5$ comma $000$$$5,000$

gain on$$ sale,

$ $65$ comma $000$$$65,000$

disposal of old machine

B$.$

$$Irrelevant:

$ $100$ comma $000$$$100,000$

cost of old$$ machine,

$ $40$ comma $000$$$40,000$

accumulated$$ amortization,

$ $5$ comma $000$$$5,000$

gain on sale

$$Relevant:

$ $120$ comma $000$$$120,000$

cost of new$$ machine,

$ $65$ comma $000$$$65,000$

disposal of old machine

C$.$

$$Irrelevant:

$ $100$ comma $000$$$100,000$

cost of old$$ machine,

$ $60$ comma $000$$$60,000$

book value of old machine

$$Relevant:

$ $120$ comma $000$$$120,000$

cost of new$$ machine,

$ $65$ comma $000$$$65,000$

disposal of old$$ machine,

$ $5$ comma $000$$$5,000$

gain on sale

D$.$

$$Irrelevant:

$ $120$ comma $000$$$120,000$

of new$$ machine,

$ $40$ comma $000$$$40,000$

accumulated amortization

$$Relevant:

$ $100$ comma $000$$$100,000$

cost of old$$ machine,

$ $65$ comma $000$$$65,000$

of disposal of old$$ machine,

$ $5$ comma $000$$$5,000$

gain on sale

E$.$

$$Irrelevant:

$ $120$ comma $000$$$120,000$

cost of new$$ machine,

$ $65$ comma $000$$$65,000$

disposal of old machine

$$Relevant:

$ $100$ comma $000$$$100,000$

cost of old$$ machine,

$ $60$ comma $000$$$60,000$

book value of old$$ machine,

$ $5$ comma $000$$$5,000$

gain on sale