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Current Design 7-1 (Part 2) Current Designs face a number of important decisions that require incrementally Cument Designs is always working to identify ways
Current Design 7-1 (Part 2) Current Designs face a number of important decisions that require incrementally Cument Designs is always working to identify ways to increase efficiency while becoming more environmentally conscious During a recent brainstorming session, one employee suggested to Dane Buswell, controller, that the company should consider replacing the current rotomold oven as a way to reale savings from reduced energy consumption. The oven operates on natural gas, using 17,000 therms of natural gas for an entire year. A new, energy-efficient rotomold oven would operate on 15,000 therms of natural gas for an entire year. After seeking out price quotes from a few suppliers, Diana determined that it would cost approximately $250,000 to purchase a new, energy-efficient remoldoven. She determines that the expected use of the new oven would be 10 years, and it would have no salvage valuat the end of its useful life. Cument Designs would be able to sell the curent oven for $10,000 Prepare an incremental analysis to determine if Current Designs should purchase the new rotomoldoven, assuming that the average price for natural gas over the next 10 years will be $0.65 pertherm (Enter decrease it came then eater with a negative preceding the number or parenthese-15,000 (15,000)) Oven Replace Oven () Venufacturing cos New oven cost Proceeds from scrapping deven Total purchase the new rotomoldoven Diane concerned that natural gas prices might increase at a faster rate over the next 10 years. If the company projects that the average natural gas price of the next 10 years could be a high as $0.00 per therm, discuss how that might change your conclusion in (x). ( decrease in net income then enter with a negative sign preceding the number ar parenthesis, ep.15,000 or (15,000)) Oven Current Designe purchase the new roto
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