Prepare analysis that shows whether Chudzick should retain

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Question - Retain or Replace Equipment - Chudzick Company has a factory machine with a book value of $180,000 and a remaining useful life of five years. A new machine is available at a cost of $300,000. This machine will have a five-year useful life with no salvage value. The new machine will lower annual variable manufacturing costs from $700,000 to $550,000.

Prepare an analysis that shows whether Chudzick should retain or replace the old machine.

Reference no: EM133037631

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