Overland Company is considering replacing a machine that is presently used in the production of its product. The following data are available:

Replacement

	Old Machine	Machine
Original cost	$90,000	$70,000
Useful life in years	10	5
Current age in years	5	0
Book value	$50,000
Disposal value now	$16,000
Disposal value in 5 years	0	0
Annual cash operating costs	$14,000	$ 8,000

The difference in cost between keeping the old machine and replacing the old machine, ignoring income taxes, is

A.

$74,000 in favour of replacing the old machine.

B.

$74,000 in favour of keeping the old machine.

C.

$24,000 in favour of keeping the old machine.

D.

$24,000 in favour of replacing the old machine.