Bavaria Inc. is considering the replacement of a piece of equipment with a newer model. The following data has been collected:

	Old Equipment	New Equipment
Purchase Price	$ 225,000	$ 375,000
Accumulated Depreciation	$ 90,000	-0-
Annual Operating Costs	$ 300,000	$ 240,000

If the old equipment is replaced now, it can be sold for $60,000. Both the old equipments remaining useful life and the new equipments useful life is 5 years.

Bavaria should a.keep the old machine, b.buy the new machine

because it will save Bavaria a.15,000, b.60,000, c.75,000, d.90,000, e.another amount other than these shown