Bryant Company has a factory machine with a book value of $93,500 and a remaining useful life of 6 years. It can be sold for $30,600. A new machine is available at a cost of $534,000. This machine will have a 6-year useful life with no salvage value. The new machine will lower annual variable manufacturing costs from $556,800 to $460,200. Prepare an analysis showing whether the old machine should be retained or replaced.

Bryant Company

Analysis of old and new machines:

                                           Old Machine       New Machine

Annual depreciation costs   $10,833               $89,000

Savings from variable

  manufacturing costs             0                      $96,600

Net savings                          ($10,833)                $7,600

Explanation:

a) Data and Calculations:

Book value of old machine = $93,500

Remaining useful life = 6 years

Salvage value = $30,600

Depreciable amount of old machine = $62,900 ($93,500 - 30,600)

Annual Depreciation cost of old machine = $10,483 ($62,900/6)

Cost of new machine = $534,000

Useful life = 6 years

Depreciable amount of new machine = $89,000 ($534,000/6)

Reduction in variable manufacturing costs = $96,600 ($556,800 - $460,200)

Savings from new machine = $7,600

b) Conclusion: The old machine should be replaced.  It costs more to retain the old machine than it costs to replace it.  There will be a net gain of $7,600 from the new machine, from the reduction of the variable manufacturing costs from $556,800 to $460,200.

answer; i believe that the correct answer is client agreement;

the correct answer would be b, when, queen, calder hall and london.

explanation:

we always capitalize words when a paragraph or sentence is starting, when an important name is used, when a place is being written, or simply when a noun is used, etc. so in this sentence, sentence is starting from 'when', so it will be written in capital letters. secondly, queen is considered to be an important person, so it will also be written in capital letter. next, the name of the town is mentioned, i-e calder hall, which will also be written in capital letters. in the last,   city name is being used, 'london', which will also be written in capital letters. so option b is the most appropriate one.