RFJ is planning the replacement of a machine that is currently used in the manufacturing of staple pin. The following information is provided:

Old Machine New Machine

Original cost $45,000 $35,000

Useful life 10 5

Current age 5 0

Book value 25,000 -

Present disposal value 8,000 -

Future disposal value 0 0

Annual operating cost 7,000 4,000

17. Based on the above information, what is the difference in cost between keeping the old machine and replacing it? A) $37,000 in favor of keeping the old machine B) $12,000 in favor of keeping the old machine C) $37,000 in favor of replacing the machine D) $12,000 in favor of replacing the machine