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Gull Corp. is considering selling its old popcorn machine and replacing it with a newer one. The old machine has a book value of $5,000
Gull Corp. is considering selling its old popcorn machine and replacing it with a newer one. The old machine has a book value of $5,000 and its remaining useful life is 5 years. Annual costs are $4,000. A high school is willing to buy it for $2,600. New equipment would cost $18,000 and annual operating costs would be $1,600. The new machine has an estimated useful life of 5 years. Should the machine be replaced? Support your answer with calculations.
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