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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › relevent costing
Ace limited is considering a new project that will require the use of a currently idle machine. The machine has a current book value of $12000 and a potential disposal value of $10500 (before $200 disposal costs) and hence has been under depreciated by $1500 over its life to date. If the machine is to be fit for purpose on the new project it will have to be relocated at a cost of $500 and refitted at a further cost of $800.
What is the relevant cost of using the machine on the new project?
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The relevant cost o fusing the machine on the new project is 11,600