Franklin Printing Company is considering replacing a machine that has been used in its factory for four years. Relevant data associated with the operations of the old machine and the new machine, neither of which has any estimated residual value, are as follows:

Old Machine
Cost of machine, 10-year life	$106,200
Annual depreciation (straight-line)	10,620
Annual manufacturing costs, excluding depreciation	38,900
Annual nonmanufacturing operating expenses	13,000
Annual revenue	95,200
Current estimated selling price of the machine	36,800
New Machine
Cost of machine, six-year life	$138,000
Annual depreciation (straight-line)	23,000
Estimated annual manufacturing costs, exclusive of depreciation	18,400

Annual nonmanufacturing operating expenses and revenue are not expected to be affected by purchase of the new machine.

1. Prepare a differential analysis as of February 28, 2014, comparing operations using the present machine (Alternative 1) with operations using the new machine (Alternative 2). The analysis should indicate the total differential income that would result over the six-year period if the new machine is acquired. If an amount is zero, enter zero "0". Differential Analysis Continue with old Machine (Alt. 1)or Replace Old Machine (Alt. 2) February 28, 2014 Continue with Old Machine (Alternative 1 Replace Old Machine (Alternative 2 Differential Effect on Income (Alternative 2 Revenues Proceeds from sale of old machine Costs Purchase price Annual manufacturing costs (6 yrs.) Income (Loss)