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Business, 24.03.2020 01:27 sabrinamarie391

Starling Co. is considering disposing of a machine with a book value of $12,500 and estimated remaining life of five years. The old machine can be sold for $1,500. A new high-speed machine can be purchased at a cost of $25,000. It will have a useful life of five years and no residual value. It is estimated that the annual variable manufacturing costs will be reduced from $26,000 to $23,500 if the new machine is purchased. The differential effect on income for the new machine for the entire five years is a(n) .

A.) decrease in $11,000B.) decrease of $15,000C.) increase of $11,000D.) increase of $15,000

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