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TB MC Qu. 10-97 (Algo) Sooky has a spotter truck with a book value... Sooky has a spotter truck with a book value of $45,000
TB MC Qu. 10-97 (Algo) Sooky has a spotter truck with a book value... Sooky has a spotter truck with a book value of $45,000 and a remaining useful life of five years. At the end of the five years the spotter truck will have a zero-salvage value. iSooky can purchase a new spotter truck for $125,000 and receive $31,500 in return for trading in its old spotter truck. The old spotter truck has variable manufacturing costs of $80,000 per year. The new spotter truck will reduce variable manufacturing costs by $25,500 per year over the five-year life of the new spotter truck. The total increase or decrease in income by replacing the current spotter truck with the new truck is: Multiple Choice $31,500 decrease $31,500 increase $34,000 decrease $125,000 decrease $34,000 increase
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