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Perez Freight Company owns a truck that cost $ 3 1 , 0 0 0 . Currently, the truck s book value is $ 2

Perez Freight Company owns a truck that cost $31,000. Currently, the trucks book value is $29,000, and its expected remaining useful life is five years. Perez has the opportunity to purchase for $27,000 a replacement truck that is extremely fuel efficient. Fuel cost for the old truck is expected to be $5,200 per year more than fuel cost for the new truck. The old truck is paid for but, in spite of being in good condition, can be sold for only $14,000.
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Calculate the total relevant costs. Should Perez replace the old truck with the new fuel-efficient model, or should it continue to use the old truck until it wears out?

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