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A certain corn mill decided to sell its old engine which had been in use for 5 years costing Php7,200 when new. The average cost per year thus far has been Php4,200. The replacement costing Php12,000 has an estimated life of 15 years, and an estimated annual operating expense 20% lower than that of the old engine. If interest is 5% and using straight-line depreciation, how much must the old engine be sold if its assumed working life is 15 years and its assumed salvage value is Php500? Actual total cost for the new engine considering depreciation, interest and operation is Php 347 less than that of the old engine. Use straight-line depreciation.
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