As the senior accountant at Technology on Demand (TOD), which
manufactures mobile technology such as flip phones, smartphones,
notebooks, and smartwatches, you are often asked to prepare various
financial analysis necessary for decision making. Michelle Dodd,
the controller, asked you to evaluate whether a piece of factory
equipment should be replaced or kept.
The old piece of factory equipment was purchased four years ago
for $875,000. Over the last four years, TOD has allocated
depreciation based on the straight-line method....