Metlock Company has a factory machine with a book value of $153,000 and a remaining useful life of 4 years. A new machine is available at a cost of $247,500. This machine will have a 4-year useful life with no salvage value. The new machine will lower annual variable manufacturing costs from $593,500 to $495,000. Prepare an analysis that shows whether Metlock should retain or replace the old machine. (If an amount reduces the net income then enter with a negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).)

		Keep Equipment		Replace Equipment		Net Income Increase (Decrease)
Variable costs		$enter a dollar amount		$enter a dollar amount		$enter a dollar amount
New machine cost		enter a dollar amount		enter a dollar amount		enter a dollar amount
		$enter a total amount		$enter a total amount		$enter a total amount

The old factory machine should be select an option retainedreplaced.

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