The TechHelp Company produces and sells 5,600 modular computer desks per year at a selling price of $450 each. Its current production equipment, purchased for $1,200,000 and with a five-year useful life, is only two years old. It has a terminal disposal value of SO and is depreciated on a straight-line basis. The equipment has a current disposal price of $600,000. However, the emergence of a new molding technology has led TechHelp to consider either upgrading or replacing the production equipment. The following table presents data for the two altematives: (Click to view the data for the two alternatives.) All equipment costs will continue to be depreciated on a straight-line basis. For simplicity, ignore income taxes and the time value of money. Read the requirements Requirement 1. Should TechHelp upgrade its production line or replace it? Show your calculations. Determine the total relevant costs over 3 years. (f a box is not used in the table, leave the box empty, do not enter a zero. Use parentheses or a minus sign for numbers to be subtracted.) Over 3 years Upgrade Replace Total relevant costs Based on the analysis above, TechHelp should the equipment. The TechHelp Company produces and sells 5,600 modular computer desks per year at a selling price of $450 each. Its current production equipment, purchased for $1,200,000 and with a five-year useful life, is only two years old. It has a terminal disposal value of SO and is depreciated on a straight-line basis. The equipment has a current disposal price of $600,000. However, the emergence of a new molding technology has led TechHelp to consider either upgrading or replacing the production equipment. The following table presents data for the two altematives: (Click to view the data for the two alternatives.) All equipment costs will continue to be depreciated on a straight-line basis. For simplicity, ignore income taxes and the time value of money. Read the requirements Requirement 1. Should TechHelp upgrade its production line or replace it? Show your calculations. Determine the total relevant costs over 3 years. (f a box is not used in the table, leave the box empty, do not enter a zero. Use parentheses or a minus sign for numbers to be subtracted.) Over 3 years Upgrade Replace Total relevant costs Based on the analysis above, TechHelp should the equipment
