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Vancouver Canucks Co. has 1,000 obsolete skates that are carried in inventory at a manufacturing cost of $20,000. If the skates are re-sharpened for $5,000,

Vancouver Canucks Co. has 1,000 obsolete skates that are carried in inventory at a manufacturing cost of $20,000. If the skates are re-sharpened for $5,000, they could be sold for $9,000. Alternatively, the skates could be sold for scrap for $1,000. Which alternative is more desirable, and what are the total relevant costs for that alternative?

1. Remachine and $5,000

2. Scrap and $20,000

3. Remachine and $25,000

4. Scrap and $19,000

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