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In the decision to keep or replace an equipment, following data is given below old purchase cost $100 000 Total life of both old and

In the decision to keep or replace an equipment, following data is given below

old purchase cost

$100 000

Total life of both old and new equipment

4 years

Annual depreciation cost

25 000

Variable cost

80 000

New equipment cost

50 000

Total accumulated depreciation

75 000


Calculate the total annual cost of keeping the old equipment.

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