What first cost should be assigned to the existing system

Reference no: EM13698941

A material handling system was purchased 3 years ago for $120,537. Two years ago it required substantial upgrading at a cost of $14,340. It once again is requiring an upgrading cost of $24,925. Alternately, a new system can be purchased today at a cost of $191,779, with a salvage value of $20,017. The existing machine could be sold today for $49,564. In an economic replacement analysis, what first cost should be assigned to the existing system?

Reference no: EM13698941

Questions Cloud

Explain why there is a blurry line dividing objects : Explain why there is a blurry line dividing objects that are “money” from those that are not. Give examples of some clear-out cases? And some borderline ones. Could the position of this blurry line change over time?

Double declining balance depreciation schedules : Jack’s construction company is considering the purchase of new equipment at a cost of $10,500; with an estimates salvage value of $500 and projected useful life of 4 years. Determine the straight-line (SL), sum of year's- digit (soyd) and double decl..

What are the ex-post real interest rates : Assume that the inflation rates in 2010, 2011, and 2012 were 1%, 2%, and 3% respectively. During the same periods, nominal interest rates were 5%, 5%, and 6%, respectively. What are the ex-post real interest rates in 2010, 2011, and 2012?

Profit-sharing royalty scheme with the stall holders : Crepe Creations is considering franchising its unique brand of crepes to stall-holders on Hermoza Beach, which is five miles long. CC estimates that on an average day there are 1,000 sunbathers evenly spread along the beach and that each sunbather wi..

What first cost should be assigned to the existing system : A material handling system was purchased 3 years ago for $120,537. Two years ago it required substantial upgrading at a cost of $14,340. It once again is requiring an upgrading cost of $24,925. Alternately, a new system can be purchased today at a co..

Why is the unrestricted entry of new firms to all markets : Why is the unrestricted entry of new firms to all markets necessary to assure the efficient allocation of resources in the long run?

Model of the money supply under fractional-reserve banking : To increase tax revenue, the US government in 1932 imposed a two-cent tax on checks written on deposits in bank accounts (In today’s dollars, this tax was about 25 cents per checks)

Decreasing return-to-scale technology : Using graph, illustrate the effect of an increase of the input price on the production and profit of a one input-one output firm with decreasing return-to-scale technology?

Current revolution a communications revolution : In what way (or ways) is the current Knowledge Revolution a child of the Industrial Revolution? Is this a new revolution or simply an extension of the 18th-century revolution? Given the history, is it perhaps more appropriate to call the current revo..

User Account

All Pages