Fuller Industries is considering replacing a machine that is presently used in its production process Which of the following amounts represents a sunk cost Old Machine Replacement Machine Original cost $60,000 $46,000 Remaining useful life in years 5 5 Current age in years 5 0 Book value $33,000 Current disposal value in cash $9,000 Future disposal value in cash (in 5 years) $0 $0 Annual cash operating costs $8,000 $4,000 A $60,000 B $33,000 C $46,000 D $9,000

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Question: Fuller Industries is considering replacing a machine that is presently used in its production process. Which of the following amounts represents a sunk cost? Old

Fuller Industries is considering replacing a machine that is presently used in its production process. Which of the following amounts represents a sunk cost?

	Old Machine	Replacement Machine
Original cost	$60,000	$46,000
Remaining useful life in years	5	5
Current age in years	5	0
Book value	$33,000
Current disposal value in cash	$9,000
Future disposal value in cash (in 5 years)	$0	$0
Annual cash operating costs	$8,000	$4,000

$60,000

$33,000

$46,000

$9,000

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