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Bell company is considering the disposal of equipment that is no longer needed for operations. the equipment originally cost $500,000 and accumulated...

Bell company is considering the disposal of equipment that is no longer needed for operations. the equipment originally cost $500,000 and accumulated depreciation to date totals $360,000. An offer has been received to lease the machine for its remaining useful life for a total of $170,000, after which the equipment will have no salvage value. The repair, insurance, and property tax expenses during the period of the lease are estimated at $35,600. Alternatively, the equipment can be sold through a broker for $120,000 less a 10% commission.

Prepare a differential analysis report, dated June 15 of the current year(2009), on whether the equipment should be leased or sold.

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CH250410_481694_ACC.docx

Differential Analysis Report dated 15th June 2009
Particulars
Incremental Revenue
(Lease rent - Sales consideration)
($1,70000 - $1,20,000) [a]
Incremental Expenses
(Repair and maintenance expenses...

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