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is considering replacing one of its old manufacturing machines. The old machine has a book Co. acturing costs are $36,000 per year for this old machine. Information on two alternative replacement alue of $45,000 and a remaining useful life of five years. It can be sold now for $52,000. Variable manu- follows. The expected useful life of each replacement machine is five years. (a) Compute the increase or decrease from replacing the old machine with Machine A. (b) Compute the income decrease from replacing the old machine with Machine B. (c) Should Lopez keep or replace its come crease or d machine? (d) If the machine should be replaced, which new machine should Lopez purchase? chines Purchase price Variable manufacturing costs per year. Co makes snowboards and uses the total cost Machine A ess than avoidable costs, as $115,000 19,000 Machine B $125,000 15,000 binow Exercise 23-10 Keep or replace P5 alans

Ca is considering replacing one of its old manufacturing machines. The old machine has a book Exereise 23-10 fict of $5,000 and a remaining useful life of five years. It can be sold now for $52,000. Variable manu- Ke keep or repiace sy thine? (d) If the machine should be replaced, which nachine B. (c) Should Loner Late the income replace its. hase

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