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How do I figure out the other Proceeds from sale of present machine and Net differential?? Skiles Coporation is a manufacturer of classic rocking chairs.

How do I figure out the other Proceeds from sale of present machine and Net differential??

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Skiles Coporation is a manufacturer of classic rocking chairs. The company has been using a particular sanding and finishing machine for over 10 years and believes that it may be time to replace the machine. The company is trying to decide whether replacing the old machine is a wise economic decision. The company's controller pulled together the following information on the old machine and the new possible replacement machine. Old Machine: Original cost $443,700 Current accumulated depreciation 314,000 Estimated annual variable manufacturing costs for machine 74,500 Estimated selling price of machine 174,700 Estimated remaining useful life (in years) New Machine: Purchase cost $788,600 Estimated annual variable manufacturing costs for machine 53,700 Estimated residual value Estimated useful life (in years) Replace or Keep Decision Differential Analysis Report Cost of replacing old machine: Annual differential decrease in cost 20,800 v x number of years 6 V Total differential decrease in cost 124,800 Proceeds from sale of present machine 174,700 Cost of new machine 788,600 Net differential (increase)/decrease in cost, six year total

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