Machine Replacement Decision A company is considering replacing an old piece of machinery, which cost $598,100 and has $351,800 of accumulated depreciation to date, with a new machine that has a purchase price of $485,100. The old machine could be sold for $63,500. The annual variable production costs associated with the old machine are estimated to be $156,100 per year for eight years. The annual variable production costs for the new machine are estimated to be $101,100 per year for eight years. a.1 Prepare a differential analysis dated May 29 to determine whether to continue with (Alternative 1) or replace (Altemative 2) the old machine. If an amount is zero, enter 0. If required, use a minus sign to indicate a loss. Differential Analysis a.2 Determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine. b. What is the sunk cost in this situation? The sunk cost is $