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Lopez Company is considering replacing one of its old manufacturing machines. The old machine has a book value of $46,000 and a remaining useful life
Lopez Company is considering replacing one of its old manufacturing machines. The old machine has a book value of $46,000 and a remaining useful life of five years, tt can be sold now for $56,000. Variable manufacturing costs are $45,000 per year for this old machine. Information on two altemative replacement machines follows. The expected useful Iffe of each replacement machine is five years: (a) Compute the income increase or decrease from replacing the old machine with Machine A. (b) Compute the income increase or decrease from replacing the old machine with Machine B. (c) Should Lopez keep or replace its old machine? (d) if the mochine should be replaced, which new machine should Lopez purchase? Complete this question by entering your answers in the tabs below. Compute the income increase or decrease from replacing the old machine with Machine A. (Amounts to be deducted should be indicated with a minus signd (d) If the machine should be replaced, which new machine should Lopez purchase? Complete this question by entering your answers in the tabs below. Compute the income increase or decrease from replacing the old machine with Machine B. (Amounts to bel deducted should be Indicated with a mines sign.) (a) Compute the income increase or decrease from replacing the old machine with Machine A. (b) Compute the income increase or decrease from replacing the old machine with Machine B. (c) Should Lopez keep or replace its old machine? (d) If the machine should be replaced, which new machine should Lopez purchase? Compiete this question by entering your answers in the tabs below. (c) Should Lopez keep or replace its old machine? (d) If the machine should be replaced, which new machine should Lopez purchase
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