1 | ||
ALTERNATIVE A: INCREASE OR (DECREASE) IN NET INCOME | ||
Cost to buy new machine | (124,000) | |
Cash received to trade in old machine | 49,000 | |
Reduction in variable manufacturing costs | 45,600 | =(33800-22400)*4 |
Total change in net income | (29,400) | |
2 | ||
ALTERNATIVE B: INCREASE OR (DECREASE) IN NET INCOME | ||
Cost to buy new machine | (116,000) | |
Cash received to trade in old machine | 49,000 | |
Reduction in variable manufacturing costs | 92,000 | =(33800-10800)*4 |
Total change in net income | 25,000 | |
3 | ||
Alternative B should be selected |
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $41,000 and a remaining useful life of five years, at which time its salvage value will be zero. It has a current market value of $51,000. Variable manufacturing costs are $33,900 per year for this machine. Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $123,000 22,200 Alternative B $120,000 10,400 Calculate the total change in net...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $44,000 and a remaining useful life of 4 years, at which time its salvage value will be zero. It has a current market value of $54,000. Variable manufacturing costs are $33,100 per year for this machine. Information on two alternative replacement machines follows. Cont Variable manufacturing costs per year Alternative $117.000 22.300 Alternative 3 $117.000 10,200 Calculate the total change in net income...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $36,000 and a remaining useful life of 4 years, at which time its salvage value will be zero. It has a current market value of $46,000. Variable manufacturing costs are $33,300 per year for this machine. Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $123,000 22.600 Alternative B $112,000 10,400 Calculate the total change in net...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $44,000 and a remaining useful life of four years, at which time its salvage value will be zero. It has a current market value of $54,000. Variable manufacturing costs are $33,100 per year for this machine. Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $120,000 22,900 Alternative B $119,000 10,400 Calculate the total change in net...
0 Homework Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $38,000 and a remaining useful life of four years, at which time Its salvage value will be zero. It has a current market value of $48,000. Variable manufacturing costs are $33,900 per year for this machine. Information on two alternative replacement machines follows. Cost Alternative $ 124,000 23,000 Variable manufacturing costs per year 111,000 19,800 Calculate the total change in net...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $36,000 and a remaining useful life of 4 years, at which time its salvage value will be zero. It has a current market value of $46,000. Variable manufacturing costs are $33,200 per year for this machine. Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $121,000 22,900 Alternative B $114,000 18,100 Calculate the total change in net...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $39,000 and a remaining useful life of five years, at which time its salvage value will be zero. It has a current market value of $49,000. Variable manufacturing costs are $33,600 per year for this machine. Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $121,000 22,700 Alternative B $115,000 10,300 Calculate the total change in net...
Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $40,000 and a remaining useful life of 5 years, at which time its salvage value will be zero. It has a current market value of $50,000. Variable manufacturing costs are $33,900 per year for this machine. Information on two alternative replacement machines follows. Alternative B Alternative A Cost $124,000 22,300 $112,000 Variable manufacturing costs per year 10,100 1. Calculate the total change in...
Exercise 23-12 Keep or replace LO A1 Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $41,000 and a remaining useful life of 5 years, at which time its salvage value will be zero. It has a current market value of $51,000. Variable manufacturing costs are $33,900 per year for this machine. Information on two alternative replacement machines follows. Alternative A $119,000 22,700 Cost Variable manufacturing costs per year Alternative B $115,000...
Exercise 23-12 Keep or replace LO A1 Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $36.000 and a remaining useful life of 4 years, at which time its salvage value will be zero. It has a current market value of $46,000. Variable manufacturing costs are $33,900 per year for this machine. Information on two alternative replacement machines follows Cost Variable manufacturing costs per year Alternative $122,000 . 22,500 Alternative B $119,000...