Sheffield Corp.is contemplating the replacement of an old machine with a new one. The following information has been gathered:

Old Machine New Machine

Price $440000 $880000

Accumulated Depreciation 132000 -0-

Remaining useful life 10years -0-

Useful life -0- 10years

Annual operating costs $352000 $264000

• If the old machine is replaced, it can be sold for $35200. The company uses straight-line depreciation with a zero salvage value for all of its assets

a. $88000

b. $132000

c. $440000

d. $35200