Bradley Industries Is Considering Replacing a Machine That Is Presently

question 103

Multiple Choice

Bradley Industries is considering replacing a machine that is presently used in its production process. Which of the following is irrelevant to the replacement decision?
$\begin{array}{|l|r|c|} \hline& \text { Old Machine } & \begin{array}{c}\text { Replacement } \\\text { Machine }\end{array} \\\hline \text { Original cost } & \$ 55,000 & \$ 45,000 \\\hline \text { Remaining useful life in years } & 5 & 5 \\\hline \text { Current age in years } & 5 & 0 \\\hline \text { Book value } & \$ 33,000 & \\\hline \text { Current disposal value in cash } & \$ 9000 & \\\hline \text { Future disposal value in cash (in 5 years) } & \$ 0 & \$ 0 \\\hline \text { Annual cash operating costs } & \$ 8000 & \$ 4500\\\hline\end{array}$ Which of the information provided in the table is irrelevant to the replacement decision?

• A) the sales price of the new machine
• B) the original cost of the old machine
• C) the current disposal value of the old machine
• D) the annual cash operating costs for both machines

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