If the old machine is replaced it can be sold for 20000., Ask an Expert

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

Old Machine New Machine
Price $250,000 $500,000
Accumulated Depreciation 75,000 -0-
Remaining useful life 10 years -0-
Useful life -0- 10 years
Annual operating costs $200,000 $150,500

If the old machine is replaced, it can be sold for $20,000. what is the net advantage (disadvantage) of replacing the old machine ?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9102049

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