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Check my work QS 23-14 Keep or replace LO P5 points Rory Company has a machine with a book value of $111,000 and a remaining

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Answer #1
Incremental income (Cost)
Reduction in variable manufacturing costs (22,500*5) 112,500
Cost of new machine -122,000
Cash received from trading old machine 64,000
Incremental income 54,500
Should machine be replaced? Yes

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