Answer the Following Questions Using the Information Below:
Frederick Company

question 160

Multiple Choice

Answer the following questions using the information below:
Frederick Company is considering replacing a machine.The following data are available:
$\begin{array}{lrr}&& \text { Replacement } \\&\text { Old Machine } & \text { Machine }\\\text { Original cost } & \$ 45000 & \$ 35000 \\\text { Useful life in years } & 10 & 5 \\\text { Current age in years } & 5 & 0 \\\text { Book value } & \$ 25000 & - \\\text { Disposal value now } & \$ 6000 & - \\\text { Disposal value in 5 years } & 0 & 0 \\\text { Annual cash operating costs } & \$ 6500 & \$ 4000\end{array}$
-Which of the data provided in the table is a sunk cost?

• A)The annual cash operating costs of the replacement machine
• B)The original cost of the old machine
• C)The annual cash operating costs of the old machine
• D)The disposal value of the old machine

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Definitions:

American Psychological Association

A professional organization representing psychologists in the United States, dedicated to advancing psychology as a science, profession, and as a means of promoting health and human welfare.

Deception

The act of misleading or tricking someone by concealing or misrepresenting the truth.

Debriefed

The procedure where research participants are given full information about the purpose and procedures of the study after their participation.

Painful Stimuli

External or internal factors that cause discomfort or pain, activating the nervous system's response to potential or actual harm.