PhotoFocus Company is a one person wedding photography com Mary, the owner and photographer purchased a camera ten years a $15,000. The camera has a 15 year useful life with zero salvage Analytical Incremental Analysis #4 The camera costs $5,500 each year to operate. Mary has found a new camera that takes more types of pictures wi better special effects for $17,000. The camera has a 5 year useful The annual operating cost will be $6,000 per year, but can be used to generate $2,200 in additional revenue each year because of the fancy pictures that can be produced. Mary will be able to sell her current camera on EBay for $6,000. 1. What would be the gain or loss on the sale of the old camera? Prepare a five year summarized incremental analysis. Variable Operating Cost Camera Cost Salvage Value Additional Revenue Total Old Camera New Camera Net Income. Increase (Decrease) What impact does replacing the old camera with the new camera have onnet income over the next five years? 2. What are the relevant factors to consider in this decision? 5. What decision should Mary make? Why. 242 3431