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The H&S Motor Company produces small motors at a production cost of $ 3 0 per unit. Defective motors can be reworked at a cost

The H&S Motor Company produces small motors at a production cost of $30 per unit. Defective motors can be reworked at a cost of $12 each. The company produces 100 motors per day and averages 88 percent good quality motors. Based on past experience, 50% of the defective motors can be reworked prior to shipping to customers. These are also considered good motors. A good motor can be sold for $100 while a defective motor can be scrapped and sold for $16. Income consists of both the revenue from the sold motors and the scrapped motors.

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