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Replace Equipment A machine with a book value of $305,000 has an estimated 6-year life. A proposal is offered to sell the old machine for

Replace Equipment

A machine with a book value of $305,000 has an estimated 6-year life. A proposal is offered to sell the old machine for $390,000 and replace it with a new machine at a cost of $473,000. The new machine has a 6-year life with no residual value. The new machine would reduce annual direct labor costs from $91,000 to $74,000.

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Prepare a differential analysis dated October 3 on whether to Continue with Old Machine (Alternative 1) or Replace Old Machine (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Differential Analysis Continue with Old Machine (Alt. 1) or Replace Old Machine (Alt. 2) October 3
Continue with Old Machine (Alternative 1) Replace Old Machine (Alternative 2) Differential Effect (Alternative 2)
Revenues:

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