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Oriole Company is considering the replacement of a piece of equipment with a newer model. The following data has been collected: Old Equipment New Equipment
Oriole Company is considering the replacement of a piece of equipment with a newer model. The following data has been collected:
Old Equipment | New Equipment |
Purchase price | $235000 | $384000 | |
Accumulated depreciation | 94000 | - 0 - | |
Annual operating costs | 309000 | 243000 |
If the old equipment is replaced now, it can be sold for $63400. Both the old equipments remaining useful life and the new equipments useful life is 5 years. Which of the following amounts is irrelevant to the replacement decision?
$141000
$384000
$63400
$320600
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