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Assume Urgent Care paid $ 4 2 , 0 0 0 for X - ray equipment four years ago. The equipment was expected to have
Assume Urgent Care paid $ for Xray equipment four years ago. The equipment was expected to have a useful life of years from the date of acquisition with annual operating costs of $ Technological advances have made the machine purchased four years ago obsolete with a zero salvage value. An improved Xray device incorporating the new technology is available at an initial cost of $ and annual operating costs of $ The new machine is expected to last only six years before it too, is obsolete. Asked to analyze the financial aspects of replacing the obsolete but still functional machine, an Urgent Care accountant prepared the following analysis. After looking over these numbers, the companys manager rejected the proposal. Perform an analysis of relevant costs to determine whether the manager made the correct decision. Cost of new machine Advantage disadvantage of replacement. $
Assume Urgent Care paid $ for Xray equipment four years ago. The equipment was expected to have a useful life of years from the date of acquisition with annual operating costs of $ Technological advances have made the machine purchased four years ago obsolete with a zero salvage value. An improved Xray device incorporating the new technology is available at an initial cost of $ and annual operating costs of $ The new machine is expected to last only six years before it too, is obsolete. Asked to analyze the financial aspects of replacing the obsolete but still functional machine, an Urgent Care accountant prepared the following analysis. After looking over these numbers, the companys manager rejected the proposal.
Perform an analysis of relevant costs to determine whether the manager made the correct decision. Cost of new machine
Advantage disadvantage of replacement. $
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