Prepare an analysis showing whether the old machine

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Kobe Company has a factory machine with a book value of $90,0000 and a remaining useful life of 5 years. It can be sold fro $30,000. A new machine is available at a cost of $300,000. This machine will have a 5 year useful life with no salvage value. The new machine will lower annual variable manufacturing cots from $600,000 to $500,000. Prepare an analysis showing whether the old machine should be retained or replaced.

Reference no: EM131206435

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