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Rory Company has a machine with a book value of $93.000 and a remaining five-year useful life. A new machine is available at a cost
Rory Company has a machine with a book value of $93.000 and a remaining five-year useful life. A new machine is available at a cost of $116,000, and Rory can also receive $63,000 for trading in its old machine. The new machine will reduce variable manufacturing costs by $16,000 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 Cost of new machine Reduction in variable manufacturing costs - Cash received from trade in of old machine 63.000 Incremental income (incremental cost) 63 000 Should the machine be replaced
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