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Brewton Freight Company owns a truck that cost $44,000. Currently, the trucks book value is $26,000, and its expected remaining useful life is five years.
Brewton Freight Company owns a truck that cost $44,000. Currently, the trucks book value is $26,000, and its expected remaining useful life is five years. Brewton has the opportunity to purchase for $25,000 a replacement truck that is extremely fuel efficient. Fuel cost for the old truck is expected to be $5,500 per year more than fuel cost for the new truck. The old truck is paid for but, in spite of being in good condition, can be sold for only $19,000.
Required: a. Calculate the total relevant costs.
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