question archive Santa's sleigh is old and in need of repair

Santa's sleigh is old and in need of repair

Subject:AccountingPrice: Bought3

Santa's sleigh is old and in need of repair. It will get through this year but a decision must be made on what to do for 2021. Some of Santa's tired reindeer are encouraging him to consider purchasing a drone for Christmas Eve deliveries and sending them off to a well-deserved retirement!! Here is information to help make the decision:

                                                              Sleigh          Drone
     Original cost                                    $25,000        Not yet purchased    
     Repairs                                           6,000
     Purchase price of drone                                       12,000
     Proceeds received sale of sleigh                           5,000
     Annual operating costs
     (Maintenance, gas, reindeer food)    2,100           1,000

a.      Which information is relevant to the decision?
b.     Based on financial considerations, which options should Santa choose
c.      Draft a paragraph about which decision he should make.



Purchase A New Answer

Custom new solution created by our subject matter experts