The Local Printing Company Purchases a New Copy Machine That

question 48

Multiple Choice

The local printing company purchases a new copy machine that reduces the cost of making a color copy by ten cents a copy. It normally makes 50,000 color copies a year and is in the 28 percent income tax bracket. The total benefits that this company will expect to realize is

• A) $1,400.
• B) $6,400.
• C) $5,000.
• D) $3,600.

---

Definitions:

Economic Life

The period during which an asset is expected to be useful and economically viable.

Lease-purchase Analysis

An evaluation to determine whether leasing or purchasing assets is more cost-effective for a business or individual.

Maintenance

The upkeep required to ensure machinery, buildings, or software remains operational and in good condition.

Insurance Premium

The amount paid for an insurance policy, typically on a regular basis, in exchange for coverage.