In a replacement decision,the initial outlay is equal to the cost of the new asset less the reduction in depreciation from elimination of the old asset.

Name: In a replacement decision,the initial outlay is equal to the cost of the new asset less the reduction in depreciation from elimination of the old asset.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

In a replacement decision, the initial outlay is equal to the cost of the new asset less the salvage value of the old asset, not the reduction in depreciation.

In a Replacement Decision,the Initial Outlay Is Equal to the Cost