Spencer Company is contemplating the replacement of an old machine with a new one. The following information has been gathered: $\begin{array}{lrr}&\text { Old Machine}&\text { New Machine }\
\text { Price } & \$ 390,000 & \$ 530,000 \
\text { Accumulated Depreciation } & 170,000 & -0 \text { - } \
\text { Remaining useful life } & 6 \text { years } & -0 \text { - } \
\text { Useful life } & -0- & 10 \text { years } \
\text { Annual operating costs } & \$ 167,000 & \$ 151.500
\end{array}$ If the old machine is replaced it can be sold for $120000. Which of the following amounts is a sunk cost?
A) $167000
B) $151500
C) $220000
D) $170000

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The Answer of Spencer Company is contemplating the replacement of an old machine with a new one. The following information has been gathered: $\begin{array}{lrr}&\text { Old Machine}&\text { New Machine }\
\text { Price } & \$ 390,000 & \$ 530,000 \
\text { Accumulated Depreciation } & 170,000 & -0 \text { - } \
\text { Remaining useful life } & 6 \text { years } & -0 \text { - } \
\text { Useful life } & -0- & 10 \text { years } \
\text { Annual operating costs } & \$ 167,000 & \$ 151.500
\end{array}$ If the old machine is replaced it can be sold for $120000. Which of the following amounts is a sunk cost?
A) $167000
B) $151500
C) $220000
D) $170000

Spencer Company Is Contemplating the Replacement of an Old Machine