Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Can someone help me fix what is wrong A company must decide between scrapping or reworking units that do not pass inspection. The company has

image text in transcribedCan someone help me fix what is wrong

A company must decide between scrapping or reworking units that do not pass inspection. The company has 19,000 defective units that cost $5.10 per unit to manufacture. The units can be sold as is for $3.10 each, or they can be reworked for $4.80 each and then sold for the full price of $8.20 each. If the units are sold as is, the company will be able to build 19,000 replacement units at a cost of $5.10 each, and sell them at the full price of $8.20 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.) Rework $ Sale as Scrap 58,900 155,800 Sales of scrap units Sales of reworked units Cost of scrap units Cost to rework units Incremental income (loss) (96,900) (96,900) 20,900 $ The company should: Sell as is *Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

IATF 16949 2016 Plus ISO 9001 2015 Audit Guide And Checklist With ISO 9001 Customer Specific Core Tools And CQI Requirments

Authors: Patrick Ambrose, Systemsthinking .works

2nd Edition

154703355X, 978-1547033553

More Books

Students also viewed these Accounting questions

Question

=+1.3(b), show that a trifling set is nowhere dense [A15].

Answered: 1 week ago