Bradford Inc. is considering replacing one of its old factory equipment with a new one. The following data are available:

Old equipment:
Purchase cost	$50,000
Remaining useful life in years	5 years
Current book value	$25,000
Annual operating costs	$8,000 per year
Current expected selling price	$10,000
Expected sales commission	5% of the selling price

New equipment:
Purchase cost	$52,000
Useful life in years	5 years
Residual value	$0
Annual operating costs	$3,000 per year

What would be the differential impact on income from replacing the equipment in five years?

Group of answer choices

$25,000 increase

$17,500 decrease

$27,500 increase

$17,000 decrease