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WileyPLUS Problem 7.6 Sew It Inc. has an industrial sewing machine that it has used for the past 5 years. The company is considering replacing
WileyPLUS Problem 7.6 Sew It Inc. has an industrial sewing machine that it has used for the past 5 years. The company is considering replacing the machine with a faster model as it is starting to break down more often. As it will be faster and eliminate overtime, it will increase revenues by $4,400 per year over its useful life of years. Current Machine New Machine Original purchase cost $26,400 $28,500 Accumulated depreciation $21,300 Useful lire years 3 years If sold now, the current sewing machine would have a salvage value of $5,200. It is used for the remainder of its useful life, the current sewing machine would have tero salvage value. The new sewing machine is expected to have zero salvage value after years, Determine whether the current sewing machine should be replaced. tgnore the time value of money) (I an amount reduces the net income then enter with a negative Nigh preceding the number... 15,000 or parenthesis, . (18,000)) Retain Replace Incremental cost savings Incremental revenues New machine cost Proceeds from sale of old machine Not Incremental savings The company replace the sewing machine Question Attempts: 0 of 3 used
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