Madison Optometry is considering the purchase of a new lens grinder to replace a machine that was purchased several years ago. Selected information on the two machines is given below:

Old

New

Machine

Machine

Original cost when new

$80,000

$85,0000

Accumulated depreciation to date

32,000

---

Current salvage value

26,000

---

Annual operating cost

4,000

3,000

Remaining useful life

4 years

4 years

Ignore income taxes and the time value of money in this problem.

Required:

Compute the total advantage or disadvantage of using the new machine instead of the old machine over the next four years.