X Open spreadsheet Replace Equipment A machine with a book value of $85,000 has an estimated five-year life. A proposal is offered to sell the old machine for $41,000 and replace it with a new machine at a cost of $46,000. The new machine has a five-year life with no residual value. The new machine would reduce annual direct labor costs from $11,200 to $7,500. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. Revenues: a. Prepare a differential analysis dated June 2 on whether to continue with the old machine (Alternative 1) or replace the old machine (Alternative 2). If an amount is zero, enter "0". Use a minus sign to indicate costs, losses, or negative differential effect on income. Show Me Flow Proceeds from sale of old machine Costs: Purchase price Direct labor (5 years) Differential Analysis Continue (Alt. 1) or Replace (Alt. 2) Old Machine June 2 Continue with Old Office 365 Machine (Alternative 1) 0 Replace Old Machine (Alternative 2) 41,000 Differential Effects (Alternative 2) Profit (Loss) b. Should the company continue with the old machine (Alternative 1) or replace the old machine (Alternative 2)? Replace the old machine

Open iproadsheet Use a minus slon to indicate conts; losses, or negative differential effect on income. b. Should the comsany continian with the old machine (Aternabve 1) or replace the old mactine (Alternative 2)