Instructions Labels and Amount Descriptions Differential Analysis Final Question Instructions Lexgraphic Printing Company is considering replacing a machine that has been used in as 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 $88820 9,050 Old Machine Cost of machine, 10-year life Annual depreciation (straight line) Annual manufacturing costs excluding depreciation Annual non-manufacturing operating expenses Annual revenue Current estimated selling pnce of machine 23,470 6020 74,030 29,610 New Machine Purchase price of machine, a year fe Annual depreciation (straightine) Estimated annual manufacturing costs, excluding depreciation $119,515 20.040 6.805 Annual non manufacturing operating expenses and revenue are not expected to be affected by purchase of the machine Differential analysis for machine replacement proposal Instructions Labels and Amount Descriptions Differential Analysis Final Question Instructions Differential Analysis Continue with Old Machine Replace Old Machine Differential Effect on Income (Alternative 2) (Alternative 1) (Alternative 2) 3. Revenues: 4 Proceeds from sale of old machine $0.00 5. Costs: 6 7 Annual manufacturing costs (6 yrs.) Purchase price 8 Income (Loss) 0.00 Estimated annual manufacturing costs, excluding depreciation 6,805 Annual non-manufacturing operating expenses and revenue are not expected to be affected by purchase of the new machine