A Truck, Costing $25,000 and Uninsured, Was Wrecked the Very

Multiple Choice

A truck, costing $25,000 and uninsured, was wrecked the very first day it was used. It can either be disposed for $5,000 cash and replaced with a similar truck costing $27,000, or it can be rebuilt for $20,000 and be brand new as far as operating characteristics and looks are concerned. The preferred decision alternative provides a net cost savings of:

A) $2,000.
B) $5,000.
C) $7,000.
D) $12,000.
E) Some amount other than these choices.