Signal mistakenly produced 1,050 defective cell phones. The phones cost $60 each to produce. A salvage company will buy the defective phones as they are for $35 each. It would cost Signal $86 per phone to rework the phones. If the phones are reworked, Signal could sell them for $136 each. Signal has excess capacity. Should Signal scrap or rework the phones? Scrap Rework Sales $ 63,000 $ 120,000 Rework costs Income