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J&H Company has a router platform with a book value of $78,000 and a three-year remaining life. A new router platform is available at a cost of $138,000, and J&H can receive $17,300 for trading in the old router platform. The old router platform has variable manufacturing costs of $64,000 per year. The new router platform will reduce variable manufacturing costs by $32,300 per year over its three-year life. Should the router platform be replaced? Multiple Choice Yes, as will increase income by $32.300 in total. Yes, as it is always important to have current technology. No, it will decrease income by $23,800 in total. Yes, as the company will increase income by $23.800 total. J & H will be not be better or worse off by replacing the router platform.

J&H Company has a router platform with a book value of $78,000 and a three-year remaining life. A new router platform is available at a cost of $138,000, and J&H can receive $17,300 for trading in the old router platform. The old router platform has variable manufacturing costs of $64,000 per year. The new router platform will reduce variable manufacturing costs by $32,300 per year over its three-year life. Should the router platform be replaced? Multiple Choice Yes, as will increase income by $32.300 in total. Yes, as it is always important to have current technology. No, it will decrease income by $23,800 in total. Yes, as the company will increase income by $23.800 total. J & H will be not be better or worse off by replacing the router platform.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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J&H Company has a router platform with a book value of $78,000 and a three-year remaining life. A new router platform is available at a cost of $138,000, and J&H can receive $17,300 for trading in the old router platform. The old router platform has variable manufacturing costs of $64,000 per year. The new router platform will reduce variable manufacturing costs by $32,300 per year over its three-year life. Should the router platform be replaced? Multiple Choice Yes, as will increase Income by $32,300 in total. Yes, as it is always Important to have current technology. No, It will decrease Income by $23,800 in total. Yes, as the company will increase Income by $23,800 total. J & H will be not be better or worse off by replacing the router platform.
Transcribed Image Text:J&H Company has a router platform with a book value of $78,000 and a three-year remaining life. A new router platform is available at a cost of $138,000, and J&H can receive $17,300 for trading in the old router platform. The old router platform has variable manufacturing costs of $64,000 per year. The new router platform will reduce variable manufacturing costs by $32,300 per year over its three-year life. Should the router platform be replaced? Multiple Choice Yes, as will increase Income by $32,300 in total. Yes, as it is always Important to have current technology. No, It will decrease Income by $23,800 in total. Yes, as the company will increase Income by $23,800 total. J & H will be not be better or worse off by replacing the router platform.
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