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:

Original cost

Annual operating cost

Accumulated de preciation

Current salvage value of the existing van

Remaining life

Salvage value in $10$ years

Annual de preciation

Exi sting van

$$50,000$

$ $17,500$

$ $30,000$

$ $22,500$

$10$ years

$ $0$

$ $2,000$

New van

$$90,000$

$ $10,000$

$10$ years

$ $0$

$ $9,000$

Relevant costs for this decision include:

$$ the original cost of the existing van

$$ accumulated depreciation the current salvage value

$$ the salvage value in $10$ years