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mon... www.525., ww, de runt om het thuhet www.thewine Pepee COM 1000 D 4,00 1.00 22.600 3,300 330 192 1168,00 1344 Analysis Codach () red

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mon... www.525., ww, de runt om het thuhet www.thewine Pepee COM 1000 D 4,00 1.00 22.600 3,300 330 192 1168,00 1344 Analysis Codach () red (AR) Mar care what efecte C11 he tout Kim Kwon Digital Components Company assembles circuit boards by using a manually operated machine to insert electronic components. The original cost of the machine is $63,400, the accumulated depreciation is $25,400, its remaining useful life is five years, and its residual value is negligible. On May 4 of the current year, a proposal was made to replace the present manufacturing procedure with a fully automatic machine that has a purchase price of $131,900. The automatic machine has an estimated useful life of five years and no significant residual value. For use in evaluating the proposal, the accountant accumulated the following annual data on present and proposed operations Present Proposed Operations Operations $ 201,000 $ 201,000 Direct materials $68,500 $68,500 Direct labor 47,600 Power and maintenance 4,400 23,500 Taxes, Insurance, etc. 1,600 5,300 Selling and administrative expenses 47,600 47,600 Total expenses $169,700 $144,900 Sales a. Prepare a differential analysis dated May 4, to determine whether to continue with the old machine (Alternative 1) or replace the old machine (Alternative 2). Prepare the analysis over the useful life of the new machine. If an amount is zero, enter "o". Differential Analysis Continue with Old Machine (Alt. 1) or Replace Old Machine (Alt. 2) May 4 Continue with Old Machine Replace Old Machine Differential Effect on Income (Alternative 1) Alternative 2 Alternative 2. Prepare a differential analysis dated May 4, to determine whether to continue with the old machine (Alternative 1) or replace the old machine (Alternative 2). Prepare the analysis over the useful life of the new machine. If an amount is zero, enter"O" Differential Analysis Continue with Old Machine (Alt. 1) or Replace Old Machine (Alt. 2) May 4 Continue with Old Machine Replace Old Machine Differential Effect on Income (Alternative 1) (Alternative 2) (Alternative 2) Sales (5 years) Costs: Purchase price Direct materials (5 years) Direct labor (5 years) Power and maintenance (5 years) Taxes, Insurance, etc. (5 years) Selling and admin. expenses (5 years) Income (Loss) I b. Based only on the data presented, should the proposal be accepted? to consider before a final decision is made. c. Differences in capacity between the two alternatives is

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