Held Company bought Machine A on August 20, 2014 for \$5,000. At the time, the estimated residual value was \$350 and the estimated life was 13 years.
On August 20, 2015, the company learned that it could buy a different machine for \$6,000. The new machine would save the company an estimated \$400 per year compared to Machine A. The new machine would have no estimated residual value and an estimated life of 12 years. The company could get \$3,000 for Machine A on August 20, 2015.
Ignoring taxes, which of the following calculations should the company use in deciding whether to purchase the new machine?