6 years ago, Global Exporters paid cash for a new packaging machine that cost $2

Question

6 years ago, Global Exporters paid cash for a new packaging machine that cost $2878,000. 3 years ago, the firm spent $2900 on repairs and modifications to the machine. The machine is now fully depreciated and has just sat idly in a corner for the past 7 months. The estimated vlue of the maching today is $124500. The firm is considering using this machine in a new project. If it does so, what value should be assigned to this machine and included in the initial costs of the new project?
a. $0
b. $2900
c. $124,500
d. $127400
e. $143,500

Explanation / Answer

initial costs of the new project = current market value of the machine = $124,500 Answer c. $124,500

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