Sala Cois Contemplating the Replacement of an Old Machine with a a New

question 129

Multiple Choice

Sala Co.is contemplating the replacement of an old machine with a new one.The following information has been gathered: $\begin{array}{lrr} & \text { Old Machine } &\text { New Machine } \\\text { Price } & \$ 300,000 & \$ 600,000 \\\text { Accumulated Depreciation } & 90,000 & -0- \\\text { Remaining useful life } & 10 \text { years } & -0- \\\text { Useful life } & -0- & 10 \text { years } \\\text { Annual operating costs } & \$ 240,000 & \$ 180,600\end{array}$ If the old machine is replaced it can be sold for $24000. Which of the following amounts is a sunk cost?

• A)$240000
• B)$180600
• C)$600000
• D)$210000

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Definitions:

Organizational Goals

The defined outcomes that an organization aims to achieve within a specified timeframe to realize its strategic plan.

Employee Motivation

The level of energy, commitment, and creativity that a company's workers bring to their jobs.

Behavioral Model

An approach or theory that focuses on understanding and modifying observable actions as a key to understanding human psychology.

Task-Centered Relations

Interactions that are primarily focused on the completion of specific tasks rather than the personal relationship between the individuals involved.