Exercise 23-4 Scrap or rework LO P2 A company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 13,000 defective units that cost $5.50 per unit to manufacture. The units can be a) sold as is for $2.80 each, or b) reworked for $4.60 each and then sold for the full price of $8.30 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 os negative values.) Sale as Scrap Rework Incremental income loss) The company should Exercise 23-5 Sell or process further LO P2 Varto Company has 7600 units of its sole product in inventory that it produced last year at a cost of $30 each. This year's modelis superior to last year's, and the 7600 units cannot be sold at last year's regular selling price of $46 each Varto has two alternatives for these items: (1) they can be sold to a wholesaler for 58 each or (2) they can be processed further at a cost of $197.400 and then sold for $33 each Should Varto sell the products as is or process further and then sell them? INCREMENTAL REVENUE AND COST OF ADDITIONAL PROCESSING Revenue if processed further Revenue il sold as is Incremental revenue Incremental net income (Loss) The company should