Calculate the total costs in keeping the old machine

Assignment Help Accounting Basics
Reference no: EM131717752

Question - A machine purchased three years ago for $720,000 has a current book value using straight-line depreciation of $400,000; its operating expenses are $60,000 per year. A replacement machine would cost $480,000, have a useful life of nine years, and would require $26,000 per year in operating expenses. It has an expected salvage value of $130,000 after nine years. The current disposal value of the old machine is $170,000; if it is kept 9 more years, its residual value would be $20,000.

Required - Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced?

Should the old machine be replaced?

Reference no: EM131717752

Questions Cloud

What is the expected yield to maturity : A 10-year U.S. Treasury bond with a par value of $1,000 is currently selling for $1,015 from various security dealers. The bond carries a 7 percent coupon rate.
Discuss when researchers use a likert scale to assess : When researchers use a Likert scale to assess individuals' attitudes, they
What are the budgeted earnings for next quarter : Selling and administrative expenses are: variable, $7.20 per unit; and fixed, $604,800 per quarter. What are the budgeted earnings for next quarter?
What is the population mean : If the standard deviation of a population is 2.14 and your sample mean is 6, and you know that 15.1% of the population would be below your sample
Calculate the total costs in keeping the old machine : Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced
What is the bond duration : A municipal bond is selling today for $1,036.80 and has a $1,000 face (par) value. Its yield to maturity is 6 percent, and the bond promises its holders $65.
Discuss informational social influence : Discuss informational social influence and normative social influence
Maximum allowable load for the aircraft : Before every? flight, the pilot must verify that the total weight of the load is less than the maximum allowable load for the aircraft.
Discuss the various symptoms of acute stress reactions : Discuss the various symptoms of acute stress reactions (ASR) and acute stress disorder (ASD) (as well as the difference between the two).

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd