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2. A truck, costing $102,500 and uninsured, is wrecked its first day in use. It can be either (a) disposed of for $14,000 cash and
2. A truck, costing $102,500 and uninsured, is wrecked its first day in use. It can be either (a) disposed of for $14,000 cash and replaced with a similar truck costing $105,500 or (b) rebuilt for $86,000 and thus be brand-new as far as operating characteristics and looks are concerned. Which action is less costly? Show your calculations. (Only complete the necessary answer boxes.) (b) Replace Rebuild Deduct: Toal relevant costs (a) (b) Remachine Scrap Future revenues $ 31,500 $ 6,000 Deduct: Future costs 27,500 $ 4,000 $ 6,000 Operating income Action (b) is more profitable. 2 A truck costing $102 500 and uninsured is wrecked its first day in us
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