On january 2 2011 kinnaird hospital purchased a 93250

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Reference no: EM13601617

On January 2, 2011, Kinnaird Hospital purchased a $93250 special radiology scanner from Faital Inc. The scanner has a useful life of 5 years and will have no disposal value at the end of its useful life. The straight-line method of depreciation is used on this scanner. Annual operating costs with this scanner are $105440. Approximately one year later, the hospital approached by Harmon Technology salesperson, Jane Black, who scanner that will save Kinnaird hospital $27540 a year in operating expenses over its 4-year useful life. She notes that the new scanner will cost $119800 and has the same capabilities as the scanner purchased last year. The hospital agrees that both scanners are equal quality. The new scanner will have no disposal value. Black agrees to buy the old scanner on January 2, 2012 compute the gain or loss on the sale.Using incremental analysis, determine if Kinnaird hospital should purchase the new scanner on January 2, 2012. Should Kinnaird replace the old scanner?

Reference no: EM13601617

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