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Cranes manufacturing is considering the purchase of new equipment that costs $615,000 to replace equipment...

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Accounting

Cranes manufacturing is considering the purchase of new equipment that costs $615,000 to replace equipment that is old and inefficient. Crane has found a buyer for the old equipment who will pay $6,560 for it. The new equipment is expected to produce $9,840 of additional revenue each year but will result in additional maintenance cost of $1,640. The new equipment will have a salvage of $8,200 and will be depreciated over 10 years. Identify the amount and timing of the cash flows relevant to Cranes decision to purchase the new equipment. (Round answers to 0 decimal places, e.g. 25,000.)

Cash Flow

Time Period

Purchase price of new equipment

$enter a dollar amount

select a time period 101-100

Additional revenue

enter a dollar amount

select a time period 101-100

Additional maintenance cost

enter a dollar amount

select a time period 1001-10

Selling price of old equipment

enter a dollar amount

select a time period 101-100

Salvage value of equipment

Answer & Explanation Solved by verified expert
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