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Please finish red sections Your answer is partially correct. Try again Johnson Enterprises uses a computer to handle its sales invoices. Lately, business has been
Please finish red sections
Your answer is partially correct. Try again Johnson Enterprises uses a computer to handle its sales invoices. Lately, business has been so good that it takes an extra 3 hours per night, plus every third Saturday, to keep up with the volume of sales invoices. Management is considering updating its computer with a faster model that would eliminate all of the overtime processing. Current New Machine Machine $24,960 original purchase cost 15,040 Accumulated depreciation 6,810 Estimated annual operating costs $19,720 $24,880 Useful life 5 years 5 years If sold now, the current machine would have a salvage value of $9,750. If operated for the remainder of its useful life, the current machine would have zero salvage value. The new machine is expected to have zero salvage value after 5 years. Prepare a incremental analysis. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45.) Net Income Retain Replace Increase Machine Machine Decrease L operating costs 19,720 24,880 5,160 New machine cost (4992) 4992 salvage value (old) T 9750 9750 Tota 9,918 Should the current machine be replaced? The current machine should be retainedStep by Step Solution
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