In making a decision to replace a machine, which of the following would not be relevant?
A)the training that workers will need in order to use the new machine
B)the variable costs of operating the new machine
C)the book value of the old machine
D)the variable costs of operating the old machine

Question

Quizplus · Accepted Answer

The book value of the old machine is not relevant in making a decision to replace a machine because it is a sunk cost and cannot be recovered regardless of whether the machine is replaced or not. The relevant factors in this decision would be the variable costs of operating both the old and new machines, as well as any costs associated with training workers to use the new machine.

In Making a Decision to Replace a Machine, Which of the Following