Rogers Company produced 40 defective units last month at a unit manufacturing cost of $40.

The defective units were discovered before shipment. Rogers Co. can sell them "as is" for

$15 or can rework them at a cost of $10 each and sell them at the original price of $60.

a. What would the incremental effect on operating income be if Rogers chose to rework

the product instead of selling it "as is"?

b. Should the company sell the units "as is" or should they

rework the units?