Berkman Company Is Considering the Purchase of New Equipment to Replace

Multiple Choice

Berkman Company is considering the purchase of new equipment to replace one-year-old equipment that is not achieving the expected results.The following information is available: $$\begin{array} { l l } \text { Expected maintenance costs of new machine } & \$ 13,000 \text { per year } \\\text { Purchase price of existing machine } & \$ 160,000 \\\text { Expected cost savings of new machine } & \$ 30,000 \text { per year } \\\text { Expected maintenance costs of exi sting machine } & \$ 8,000 \text { per year } \\\text { Resale value of existing machine } & \$ 45,000\end{array}$$ Which of these items is NOT relevant to this decision?

A) the expected maintenance costs of the new machine
B) the purchase cost of the existing machine
C) the expected maintenance costs of the existing machine
D) the expected resale value of the existing machine