a segment of hazard

Chapter 7: Two problems: Show computation impact on net income) and make a decision on whether to: 1. Retain or replace equipment. E 7-14 & Review exercise 2. Keep or eliminate a division. Do it! 7-6, E 7-15 and MC 14 Retain or Replace an Old Machine New machine $90,000 Purchase cost Accumulated depreciation Disposal (salvage) value if sold now Annual operating expenses Remaining life Old machine $72,000 40,000 15,000 100,000 5 years N/A 90,000 5 years Sales are expected to remain the same regardless of old or new machine. The new machine is expected to have zero salvage value after five years. Should the old machine be retained or replaced