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PharmaMED is considering replacing an old Tablet Press with a new high tech state of the art tablet press. Estimates for the next ten years
PharmaMED is considering replacing an old Tablet Press with a new high tech state of the art tablet press. Estimates for the next ten years are as follows: Old Press New Press Average annual sales $900,000 $975,000 Annual operating costs $450,000 $350,000 Original costs of old tablet $950,000 press Accumulated Depreciation $855,000 List price of new tablet press $1,725,000 101 Remaining life years Expect life years $50,000 Salvage value now Disposal value in 10 years Instructions: $nill $nil a) Prepare an incremental analysis for the keep or replace equipment decision. b) In the box below, enter the impact on income C) After completing the quiz, upload all calculations supporting your answer including a decision to keep or replace the equipment
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