ACC202 Week 4 Synchronous Session Question 4

Rory Company has a machine with a book value of $95,000 and a remaining five-year useful life. A new machine is available at a cost of $115,000, and Rory can also receive $67,000 for trading in its old machine. The new machine will reduce variable manufacturing costs by $21,500 per year over its five-year useful life. Calculate the incremental income. (Any losses or outflows should be entered with a minus sign.) Incremental Income From Replacing Machine Incremental income (incremental cost)