QS 25-14 Keep or replace LO P5 Rory Company has a machine with a book value of $121,000 and a remaining five-year useful life. A new machine is available at a cost of $117,000, and Rory can also receive $69,000 for trading in its old machine. The new machine will reduce variable manufacturing costs by $24,000 per year over its five-year useful life. Calculate the incremental income. (Any losses or outflows should be entered with a minus sign.) Incremental Income From Replacing Machine LA Reduction in variable manufacturing costs Cost of new machine Cash received from trade in of old machine Book value of old machine