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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › relevant costing
A company purchased a machine several years ago for £79,000. Its written down value is now £37,000. The
machine is no longer used on normal production work and it could be sold now for £8,000.
A one-off contract is being considered which would make use of this machine for six months. After this time the
machine would be sold for £6,000.
What is the relevant cost of the machine to the contract?
For my calculation will be the following:
Sold now $8,000
Cost of disposing $6,000
relevant cost will be nil, is because relevant costing is excluding the loss of disposal. But it seems like the answer is wrong.
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What do you get as an answer?