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Old Equipment: New Equipment: Book Value 000 $300 Cost $400 000 Disposal Value (now) $ 56 000 Remaining useful life Disposal Value at end
Old Equipment: New Equipment: Book Value 000 $300 Cost $400 000 Disposal Value (now) $ 56 000 Remaining useful life Disposal Value at end 10 yr. 10 yr. 0 $84,000 Annual Estim. Sales $480 000 $500 000 Annual Operating cost $300 000 $290 000 (A) Show the incremental 10-year profit if the new equipment is purchased. (B) If the disposal value of the current (old) equipment in 10 years would be $45,000 instead of zero; show the incremental 10-year profit if the new equipment is purchased.
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