Machine Replacement Dedision A company is considering replacing an old plece of machinery, which cont $598,000 and has $348,500 of accumulated depreciation to date, with a new machine that has a purchase price of $485,200. The old machine could be sold for $61,900. The annual variable production costs associated with the old machine are estimated to be $156,400 per year for eight years. The aninual variable production costs for the new machine are estimated to be $101,100 per year for eight years. a.1 Prepare a differential analysis dated May 29 to determine whether to continue with (Alternative 1) or replace (Aternative 2) the old machine. If an amount is zero, enter "0". If required, use a minus slon to indicate a loss. Differential Analysis a.2 Determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine. Feedback Check My Work Compare the differential revenues and differential costs of continuing vs, replacing. Which one ha: effect on income? b. What is the sunk cost in this situation? The sunk cost is \$