Question $33(1$ point$)$

Green Company can purchase a new machine for $$100,000.$ The new machine will have a five$-$year life with no salvage value. The machine should reduce labor costs by $$22,000$ per year. Green Company would have to scrap its existing machine, receiving no cash. The existing machine has a book value of $$15,000.$ Should Green purchase the new machine?

Yes, as the decreased labor costs are greater than the cost of the new machine. No$,$ as the decreased labor costs are less than the cost of the new machine plus the book value of the existing machine.

No$,$ as the decreased labor costs are less than the cost of the new machine.

Yes, as the decreased labor costs are greater than the cost of the new machine plus the book value of the existing machine.