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Differentiai Analysis for Machine Replacement Proposal Gutenberg Publishers inc. is considering replacing a machine that has been used in its factory for 4 years. Relevant

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Differentiai Analysis for Machine Replacement Proposal Gutenberg Publishers inc. is considering replacing a machine that has been used in its factory for 4 years. Relevant data associated wath the operations of the old machine and the new machine, neither of which has any estimated residual value, are as folows: Annual nonmahufacturing eeerating expersis and revenve are not expected to be affected by purchase of the new machine. Required: 1. Prepare a defterential anarysis as of November 30 comparing operations using the present machine (Nternative 1) with operations using the new machine (Akerrative 2). The analysis should indicate the total differentat profit that would resuit over the 6 -year peciod if the new machene is acquired. If an amcont is reto, enter " . If required, use a minus sign to indicate e losk. 1. Prepare a dfferential analysis as of November 30 comparing operations usioj the present machine (Alternative 1) with operabions using the new machine (Aiternative 2). The analysis should indicate the totat offerential profit that would result over the 6 -year period if the pew machine is acguired. If an amount is zero, enter " 0 ". If required, use a minus sign to indicate a loss. Differential Analysis 2. Identify the factor that needs to be considered for asset replacement decision in a company. a. The quality of the machine and its working capacty b. The federal taxes payable c. The amount of investment required to replace or purchase the new machine d. All the above

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