Please correct and incorrect option explain Sunland Company is considering the replacement of a piece of equipment with a newer model. The following data has been collected:Old EquipmentNew EquipmentPurchase price$245000$390000Accumulated depreciation102000-0-Annual operating costs318000246000If the old equipment is replaced now, it can be sold for $68000. Both the old equipment's remaining useful life and the newequipment's useful life is 4 years. Both assets have a $0 end-of-life salvage value.The net advantage (disadvantage) of replacing the old equipment with the new equipment isO $68000O $(34000)O $102000O $(73000)

Salvage Value of the Old Equipment: The old equipment can be sold now for $68,000. This is a cash…

Answered: Sunland Company is considering the…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 10P

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