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On January 2, 2021, Twilight Hospital purchased a $ 104,400 special radiology scanner from Sheridan Inc. The scanner had a useful life of 4 years

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On January 2, 2021, Twilight Hospital purchased a $ 104,400 special radiology scanner from Sheridan Inc. The scanner had a useful life of 4 years and was estimated to have no disposal value at the end of its useful life. The straight-line method of depreciation is used on this scanner. Annual operating costs with this scanner are $ 106,000. Approximately one year later, the hospital is approached by Dyno Technology salesperson, Jacob Cullen, who indicated that purchasing the scanner in 2021 from Sheridan Inc. was a mistake. He points out that Dyno has a scanner that will save Twilight Hospital $ 25,000 a year in operating expenses over its 3-year useful life. Jacob notes that the new scanner will cost $ 110,000 and has the same capabilities as the scanner purchased last year. The hospital agrees that both scanners are of equal quality. The new scanner will have no disposal value. Jacob agrees to buy the old scanner from Twilight Hospital for $ 55,500. Prepare an incremental analysis of Twilight Hospital in the first two columns, enter costs and expenses as positive amounts, and any amounts received as negative amounts. In the third column, enter net income increases as positive amounts and decreases as negative amounts. Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (451) Retain Scanner Replace Scanner Net Income Increase (Decrease) Operating costs 106000 B1000 25000 New scanner cost 110000 - 110000 Old scanner salvage 55500 35500 Total 105000 $ 135500 $ 29500 Should Twilight Hospital purchase the new scanner on January 2.2020

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