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Crane Company is considering the replacement of a piece of equipment with a newer model. The following data has been collected: Old Equipment New Equipment
Crane Company is considering the replacement of a piece of equipment with a newer model. The following data has been collected: Old Equipment New Equipment $260000 $376000 Purchase price Accumulated depreciation 110000 -0- Annual operating costs 310000 241000 If the old equipment is replaced now, it can be sold for $61000. Both the old equipment's remaining useful life and the new equipment's useful life is 4 years. The net advantage disadvantage) of replacing the old equipment with the new equipment is O $110000 $(50000) O $61000 O $(39000)
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