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Sala Co. is contemplating the replacement of an old machine with a new one. The following information has been gathered: Price Old Machine New Machine

Sala Co. is contemplating the replacement of an old machine with a new one. The following information has been gathered: Price Old Machine New Machine $300,000 $600,000 $240,000 $180,600 Annual operating costs The remaining life of the old machine and estimated life of the new machine are both 10 years. If the old machine is replaced, it can be sold for $24,000. The net advantage (disadvantage) of replacing the old machine is $18,000 $24,000 ($6,000) ($60,000)

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