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Car Accessories has an inventory of 500 obsolete remote entry keys that are carried in inventory at a manufacturing cost of $80,500. Production supervisor Ricky
Car Accessories has an inventory of 500 obsolete remote entry keys that are carried in inventory at a manufacturing cost of $80,500. Production supervisor Ricky Peters must decide to do one of the following: Process the inventory further at a cost of $23,000, with the expectation of selling it for $33,000 . Scrap the inventory for a sales price of $5,000 What should Peters do? Present figures to support your decision. Prepare the Sell or Process Further analysis. (Enter a "0" for any zero amounts. Use a minus sign or parentheses when the scrap amount exceeds the process further amount.) Incremental Analysis Sell of Process Further Decision Sell As Is (Scrap) Process Further Difference Revenues Less: Extra cost of processing further Net benefit (loss) to operating income
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