Question: Mcurtain Gear has been using the same mochines fo make its riame-brand cloting for the last tivo years. A cost elficiency conscitant has suggested that

Mcurtain Gear has been using the same mochines fo make its riame-brand cloting for the last tivo years. A cost elficiency conscitant has suggested that production costs may be reduced by purchasing more technologically advanced machinery. The old mochines cove the campony 542000 - the old mugehinks presently have a book value of $142.000 and a market value of $34.000. They are expected to havo o five year remaining ke and zero salvage value. The new machiones would cont the comparty $370.000 and have operating expenses of $19.000 a year. The new machines are expected to have a fiver-year eretul life and no salvage value. The operating expenses ossociated with the old mochines iate $52000 a yeac. The hermachines are expected to increase quality. Juktlying a price inctoase and thereby increasing soles revenue by $32.000 a yeat. Select the tave stafement. Multiple Cholce The company will be $39,000 better off over the 5 -year period if it replaces the old equipinent. The company will be $50.000 better off over the 5 year period if it replaces the old equipment. The company will be $84,000 better off over the s-year periodif it keeps the old equipment. The company will be $34,000 better off over the 5 -year period if it replaces the old equipment
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