Question
Jansen Industries is considering replacing a machine that is presently used in its production process. The following information is available: Old Machine Replacement Machine Original
Jansen Industries is considering replacing a machine that is presently used in its production process. The following information is available:
Old Machine
Replacement
Machine
Original cost
$25,000
$35,000
Remaining useful life in years
1
5
Current age in years
5
0
Book value
$5,000
Current disposal value in cash
$3,000
Future disposal value in cash (in 5 years)
$0
$2,000
Annual cash operating costs
$7,000
$4,000
Which of the information provided in the table is irrelevant to the replacement decision?
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Accounting For Decision Making And Control
Authors: Jerold Zimmerman
10th Edition
1259969495, 978-1259969492
