Should the old machine be replaced

Assignment Help Managerial Accounting
Reference no: EM133059181

Question - A machine purchased three years ago for $820,000 has a current book value using straight-line depreciation of $450,000; its operating expenses are $65,000 a year. A replacement machine would cost $520,000, have a useful life of nine years, and would require $30,000 per year in Operating expenses. It has an expected salvage value of $175,000 after nine years. The current disposal value of the old machine is $195,000; if it is kept 9 more years, its residual value would be $40,000. Based on this information, should the old machine be replaced? Support your work.

Reference no: EM133059181

Questions Cloud

How can a firm synchronize its cash flows : Smith decided at age 62 that he wasn't quite ready to stay at home living the life of leisure. How can a firm synchronize its cash flows
What is the equipment after-tax salvage value : Karsted can sell the used equipment today for $8 million, and its tax rate is 20%. What is the equipment's after-tax salvage value
What is the cash flow from operating activities : During this year, there is also a gain of $300 from the disposal of an old machine. What is the Cash Flow from Operating Activities in 2020
Compute depreciation expense : Depreciation Methods A machine costing $145,800 was purchased May 1, 2019. The estimated salvage value is $5,400. Compute depreciation expense
Should the old machine be replaced : A machine purchased three years ago for $820,000 has a current book value using straight-line depreciation of $450,000; Should the old machine be replaced
Challenges manager faces in motivating employees : Identify three challenges a manager faces in motivating employees today as opposed to 50 years ago.
What the capitalized cost : Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $400,000. Materials used up in testing cost $2,100. What the capitalized cost
Contribute positively to individual performance : Describe each of the "Big 5" personality traits. For each trait, provide an example of how it might contribute positively to an individual's performance.
Discuss whether coca cola strategies resolved the issue : Discuss whether Coca Cola strategies resolved the issue and offer an alternative strategy you believe would help address the CSR issue.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Compute the amounts for the month of october

Manufacture of leather belts in the Marikina Plant to the top management of Pasado Leather Company, compute the amounts for the month of October.

  What was the growth rate in earnings per share

Ten years ago, Kronan Corporation earned $0.50 per share. Its earnings this year were $2.8. What was the growth rate in earnings per share

  Find monthly fixed support cost and variable support cost

Explain how your analysis for requirement question 1 would change if new October data were received and machine hours were 1,650 and support costs

  Prepare revenue budget for the upcoming academic year

Determine the number of staff needed to cover classes. List at least five actions that South Hampton might take to accommodate the growing student numbers.

  What the total overhead of molding and assembly departments

If the cost allocation is based on direct method, after the allocation, the total overhead of Molding and Assembly departments are

  Concept of sunk cost and opportunity cost

Calculate the no. of package tours that must be sold to break even and calculate the revenue needed to earn a target operating income

  What would expect to happen to the investment return

If the return on the market portfolio were to increase by 10%, what would you expect to happen to the investment's return? What if the market return

  Compute purchases for March

Inventory turnover = 5.0, average inventory = $20,000, and beginning inventory of raw materials = $15.000. Compute purchases for March

  How much is the cost for each job completed

The two Jobs are sold to MVB at 5 times of the cost. Give the journal entries to record the sale which was for Cash. How much is the Cost for each Job completed

  Which is a benefit of decentralisation

Which is a benefit of decentralisation? Increased motivation of management. / Focus on the firm as a whole. / Suboptimal decision making

  What is the time value of money

What is the time value of money? Funds received today are worth less than the same amount received in the future because of depreciation.

  Analyze the project with net present value

Using the template provided, analyze the project 1 with Net Present Value, Internal Rate of Return, Payback Period, and Modified Payback Period

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd