8. Lopez Company is considering replacing one of its old manufacturing machines. The old machine has a book value of $46,000 and a remaining useful life of five years. It can be sold now for $56,000. Variable manufacturing costs are $43,000 per year for this old machine. Information on two alternative replacement machines follows. The expected useful life of each replacement machine is five years. Machine A Machine B Purchase price $ 122,000 $ 136,000 Variable manufacturing costs per year 21,000 13,000 (a) Compute the income increase or decrease from replacing the old machine with Machine A. (b) Compute the income increase or decrease from replacing the old machine with Machine B. (c) Should Lopez keep or replace its old machine? (d) If the machine should be replaced, which new machine should Lopez purchase?

9.Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and $332,500 of its fixed costs are avoidable. Segment Income (Loss) Sales $ 1,107,400 Variable costs 791,000 Contribution margin 316,400 Fixed costs 379,000 Income (loss) $ (62,600) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated?

10. Cobe Company has manufactured 210 partially finished cabinets at a cost of $52,500. These can be sold as is for $63,000. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $12,600, and the finished cabinets could be sold for $84,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should the cabinets be sold as is or processed further and then sold?