A machine's current book value is $600. The machine cost $1,300 three years ago. Operating expenses have been $380 per year, and the machine could last for three more years. Because of a breakthrough in design, a replacement machine would save $300 per year can be purchased for $1,000 and has an expected service life of eight years. The scrap value of either machine at any time after installation is $100. If the IRS allows straight line depreciation over a six year period for this type of machinery and if an after tax MARR of 12% is applicable, should the current machine be replaced? The company's tax rate is 52%.

Joint cost cheyenne, inc. produces three products from a common input. the joint costs for a typical quarter follow: direct materials $45,000 direct labor 55,000 overhead 60,000 the revenues from each product are as follows: product a $75,000 product b 80,000 product c 30,000 management is considering processing product a beyond the split-off point, which would increase the sales value of product a to $116,000. however, to process product a further means that the company must rent some special equipment costing $17,500 per quarter. additional materials and labor also needed would cost $12,650 per quarter. a. what is the gross profit currently being earned by the three products for one quarter? $answer b. what is the effect on quarterly profits if the company decides to process product a further? $answer