Hip Manufacturing produces denim clothing. This year it produced 3,060 denim jackets at a cost of $91,800. These jackets were damaged in the warehouse during storage. Management identified three alternatives for these jackets. 1. Jackets can be sold as scrap to a secondhand clothing shop for $18,360. 2. Jackets can be disassembled at a cost of $6,120 and sold to a recycler for $36,720. 3. Jackets can be reworked and turned into good jackets. The cost of reworking the jackets will be $104,040, and the jackets can then be sold for $137,700. Required: (1) Compute the income for each alternative. (2) Which alternative should be chosen? Scrap, Recycle or Rework Analysis Revenue from scrap/recycle/rework Cost of recycled/reworked units Scrap Recycle Rework Income $ 0 $ 0 $ 0 Recycle Rework Scrap