Operating characteristics


A truck, costing $100,000 and uninsured, is wrecked its first day in use. It can be either (a) disposed of for $15,000 cash and replaced with a similar truck costing $105,000 or (b) rebuilt for $85,000, and thus be brand -new as far as operating characteristics and looks are concerned. Which action is less costly? Show your calculations.

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Accounting Basics: Operating characteristics
Reference No:- TGS049912

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