A Company Is Planning to Replace an Old Machine with a New

question 8

Multiple Choice

A company is planning to replace an old machine with a new one.Which of the following is a sunk cost?

• A) cost of the new machine
• B) sales price of the old machine
• C) future maintenance costs of the old machine
• D) original cost of the old machine

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Definitions:

Duty

A moral or legal obligation to perform or refrain from performing a certain action.

Rescind

To revoke, cancel, or repeal a contract, agreement, or law, making it as though it never existed.

Tenant

An individual or entity that occupies property or land rented from a landlord or owner.

Overcharges

The act of charging someone more than the fair or agreed upon price for goods or services.