Question: Pizza For Everyone is considering replacing its existing delivery van with a new one. The new van can offer considerable savings in operating costs.
Pizza For Everyone is considering replacing its existing delivery van with a new one. The new van can offer considerable savings in operating costs. Information about the existing van and the new van follow: Onginal cost Annual operating cost Accumulated depreciation Current salvage value of the existing van Remaining life Salvage value in 8 years Annual depreciation Sunk costs include Existing van New van $58,000 $98,000 $18,500 $15,000 $34,000 $23,500 8 years 8 years $0 $0 $3000 $12,250 O the current salvage value of the existing van O the annual operating cost of the new van O the original cost of the new van the accumulated depreciation of the existing van
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