Prepare analysis showing the old machine should retained

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Question - Cullumber Company has a machine that affixes labels to bottles. The machine has a book value of $84,800 and a remaining useful life of 3 years and no salvage value. A new, more efficient machine is available at a cost of $318,000 that will have a 3-year useful life with no salvage value. The new machine will lower annual variable production costs from $551,200 to $434,600. Prepare an analysis showing whether the old machine should be retained or replaced.

Reference no: EM133173224

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