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Machine replacement decision A company is considering replacing an old piece of machinery, which cost $ 6 0 0 , 6 0 0 and has

Machine replacement decision
A company is considering replacing an old piece of machinery, which cost $600,600 and has $352,400 of accumulated depreciation to date, with a new machine that has a purchase price of $485,000. The old machine could be sold for $62,900. The annual variable production costs associated with the old machine are estimated to be $155,200 per year for 8 years. The annual variable production costs for the new machine are estimated to be $102,300 per year for 8 years.
a.1 Prepare a differential analysis dated December 10 to determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss.
Differential Analysis
Continue with (Alt.1) or Replace (Alt.2) Old Machine
December 10
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