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What depreciation on the machine is an example of a

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Question 1: A company paid $200,000 ten years ago for a specialized machine that has no salvage value and is being depreciated at the rate of $10,000 per year. The company is considering using the machine in a new project that will have incremental revenues of $28,000 per year and annual cash expenses of $20,000. In analyzing the new project, the $10,000 depreciation on the machine is an example of a(n):

Option A) Incremental cost.

Option B) Opportunity cost.

Option C) Variable cost.

Option D) Sunk cost.

Option E) Out-of-pocket cost.

Reference no: EM132537098

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