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1 Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $38.000 and a remaining useful life of
1 Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $38.000 and a remaining useful life of four years, at which time its salvage value will be zero. It has a current market value of $48,000. Variable manufacturing costs are $33,200 per year for this machine. Information on two alternative replacement machines follows. 25 points Cost variable manufacturing costs per year Alternative A $122,000 22,600 Alternative B $112,800 11,000 eBbok Calculate the total change in net income if Alternative A B is adopted. Should Xinhong keep or replace its manufacturing machine? ir the machine should be replaced, which alternative new machine should Xinhong purchase? Hist Complete this question by entering your answers in the tabs below. Alternative A Alternative B Xinhong Purchase Calculate the total change in net income Alternative A adopted. (Cash outflows should be indicated by a minus sign.) References ALTERNATIVE A: INCREASE OR (DECREASE) IN NET INCOME Cost to buy new machine Cash received trade in old machine Reduction in variable manufacturing costs Total change in net income PADA Alternative B > 1 Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $38,000 and a remaining useful life of four years, at which time its salvage value will be zero. It has a current market value of $48.000. Variable manufacturing costs are $33,200 per year for this machine. Information on two alternative replacement machines follows. 25 points Cost Variable manufacturing costs per year Alternative A $122,000 22,600 Alternative B $112,600 11,000 eBook Calculate the total change in net income if Alternative A, B is adopted. Should Xinhong keep or replace its manufacturing machine? If the machine should be replaced, which alternative new machine should Xinhong purchase? 9900 Hint Complete this question by entering your answers in the tabs below. Print Alternative A Alternative B Xinhong Purchase References Calculate the total change in net income if Alternative B is adopted. (Cash outflows should be indicated by a minus sign.) ALTERNATIVE B: INCREASE OR (DECREASE) IN NET INCOME Cost to buy new machine Cash received to trade in old machine Reduction in variable manufacturing costs Total change in net income
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