Nighthawk Inc

question 49

Multiple Choice

Nighthawk Inc.is considering disposing of an old machine with a book value of $22,500 and an estimated remaining life of three years.The old machine can be sold for $6,250.A new machine with a purchase price of $68,750 is being considered a replacement.It will have a useful life of three years and no residual value.It is estimated that the annual variable manufacturing costs will be reduced from $43,750 to $20,000 if the new machine is purchased.The differential effect on income for the entire three years for the new machine is

• A) $8,750 increase
• B) $31,250 decrease
• C) $8,750 decrease
• D) $2,925 decrease

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Definitions:

Osteoclasts

A type of bone cell that breaks down bone tissue, a vital process for bone growth, healing, and maintenance.

Osteoblasts

Osteoblasts are specialized cells involved in the synthesis and mineralization of bone during both initial bone formation and later bone remodeling processes.

Basic Multicellular Unit

A functional unit of bone, responsible for bone remodeling, consisting of osteoclasts that resorb bone and osteoblasts that form new bone.

Ethmoid

A spongy bone located between the eyes that forms part of the nasal cavity and the orbits of the eyes, contributing to the structure of the face and the sense of smell.