Do It! Review 7-5 Your answer is partially correct. Try again. Darcy Roofing faced with a decision. The company relies very heavily on the use of its 60-foot extension lift for work on large homes and commercial properties. Last year, Darcy Roofing spent $70,800 refurbishing the lift. It has just determined that another $36,000 of repair work is required. Alternatively, it has found a newer used lift that is for sale for $153,000. The company estimates that both lifts would have useful lives of 6 years. The new lift is more efficient and thus would reduce operating expenses by about $23,600 per year. Darcy Roofing could also rent out the new lift for about $9,000 per year. The old lift is not suitable for rental. The old lift could currently be sold for $22,500 if the new lift is purchased. Prepare an incremental analysis showing whether the company should repair or replace the equipment. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Retain Replace Net Income Equipment Equipment Increase (Decrease) Operating expenses 141600 Repair costs 36000 Rental revenue 54000 New machine cost 153000 BODE Sale of old machine 22500 X Total cost 177600 153000 76500 Should company repair or replace the equipment? should The equipment be replaced Click if you would like to Show Work for this question: Open Show Work