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Mountain Gear has been using the same machines to make its...

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Accounting

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Mountain Gear has been using the same machines to make its name-brand clothing for the last five years, A cost efficiency consultant has suggested that production costs may be reduced by purchasing more technologically advanced machinery. The old machines cost the company $430,000. The old machines presently have a book value of $143,000 and a market value of $35,000. They are expected to have a five-year temaining life and zero salvage value. The new machines would cost the company $330,000 and have operating expenses of $17,000 a year. The new machines are expected to have a five-year useful life and no salvage value. The operating expenses associated with the old machines are $53,000 a year. The new machines are expected to increase quality. Justifying a price increase and thereby increasing sales revenue by $33.000 a year. Select the true statement. Multiple Choice The company will be $50,000 better of over the 5 year period if at replaces the old equipment. The compacy wil be $51,000 better of over the 5 year period if it replaces the old equipment The company wil be $35,000 better off over the 5 year period if a replaces the old equipmenh. The company will te 316,000 betier off over the 5 year perlod it a keeps the old cquipment

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