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Delaney Company Is Considering Replacing Equipment That Originally Cost $600,000

Question 46

Multiple Choice

Delaney Company is considering replacing equipment that originally cost $600,000 and has accumulated depreciation of $420,000 to date. A new machine will cost $790,000 and the old equipment can be sold for $8,000. The sunk cost in this situation is


A) $172,000
B) $180,000
C) $188,000
D) $290,000

Correct Answer:

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