Janko Wellspring Inc. has a pump with a book value of $24,000 and a four-year remaining life. A new, more efficient pump, is available at a cost of $45,000. Janko can also receive $8,000 for trading in the old pump. The new pump will reduce variable costs by $10,000 per year over its four-year life. The costs not relevant to the decision of whether or not to replace the pump are:
A. $8,000.
B. $16,000.
C. $24,000.
D. $40,000.
E. $10,000.
Answer: C
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