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One of the employees of RF Corporation recently was involved in an accident with one of the corporation's delivery vans. The corporation is either going
One of the employees of RF Corporation recently was involved in an accident with one of the corporation's delivery vans. The corporation is either going to repair the damaged van or sell it as is and buy a comparable used van. Information related to this decision is provided below:
Initial cost of damanged van....................................... | $30,000 |
Accumulated depreciation to date on van..................... | $18,000 |
Salvage value of van immediately before crash............ | $ 9,000 |
Salvage value of van immediately after crash.............. | $ 1,000 |
Cost to repair damaged van....................................... | $ 5,000 |
Cost of a comparable used van................................... | $10,000 |
Based on the information above, RF would be better off by:
A) $1,000 to buy the comparable van. |
B) $2,000 to buy the comparable van. |
C) $2,000 to repair the damaged van. |
D) $3,000 to repair the damaged van. |
E) $4,000 to repair the damaged van. |
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