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A Company is trying to decide whether to replace an old machine with a new one. The following data were analyzed. Cost savings per year
A Company is trying to decide whether to replace an old machine with a new one. The following data were analyzed.
Cost savings per year on new machine | $100,000 |
New machine cost | $150,000 |
Revenue from sale of old machine | $10,000 |
Book value of old machine | $25,000 |
The purchase of a new machine would have what effect on net income?
Net increase of $15,000
Net increase of $40,000
Net decrease of $15,000
Net decrease of $40,000
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