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A Machine purchased 3 years ago... A machine purchased three years ago for $313,000 has a current book value using straight-line depreciation of $195,000; its

A Machine purchased 3 years ago... image text in transcribed

A machine purchased three years ago for $313,000 has a current book value using straight-line depreciation of $195,000; its operating expenses are $35,000 per year. A replacement machine would cost $234,000, have a useful life of eleven years, and would require $10,000 per year in operating expenses. It has an expected salvage value of $79,000 after eleven years. The current disposal value of the old machine is $89,000; if it is kept 11 more years, its residual value would be $13,000. Required Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced? Keep Old Machine Purchase New Machine Total costs Should the old machine be replaced

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