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Relevant Costing

This topic has 1 reply, 2 voices, and was last updated 6 years ago by John Moffat.

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December 9, 2018 at 3:51 pm #488569
lusan
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Studley Co. Purchased a Machine 3 years ago for $ 15,000. It can be sold now for $ 9,000. The current replacement cost of an equivalent machine is $ 14,000. If studley Co keeps the machine for use in the business it is expected to generate net income $ 17,000.
What is the replacement cost of the Machine?
Please make it clear as I’m confused regarding relevant costing of Non-Current Asset
December 10, 2018 at 7:19 am #488658
John Moffat
Keymaster
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In future you must ask in the Ask the Tutor Forum if you want me to answer – this forum is for students to help each other.
The replacement cost is the cost of buying a new machine.
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