A company must decide between scrapping or reworking units that do not pass inspection. The company has 16,000 defective units that have already cost $132,000 to manufacture. The units can be sold as scrap for $51,200 or reworked for $72,000 and then sold for $136,000. (a) Prepare a scrap or rework analysis of income effects. (b) Should the company sell the units as scrap or rework them? (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Cost of reworked units Income Scrap $ 0 SA Rework $ 0 Incremental income (b) The company should: 13 ง
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- A company must decide between scrapping or reworking units that do not pass inspection. The company has 13,000 defective units that have already cost $132,000 to manufacture. The units can be sold as scrap for $33,800 or reworked for $59,800 and then sold for $111,800. (0) Prepare a scrap or rework analysis of income effects. (b) Should the company sell the units as scrap or rework them? (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Cost of reworked units Income Incremental income (b) The company should Scrap ReworkA company must decide between scrapping or reworking units that do not pass inspection. The company has 16,000 defective units that have already cost $132,000 to manufacture. The units can be sold as scrap for $52,800 or reworked for $75,200 and then sold for $137,600. (a) Prepare a scrap or rework analysis of income effects. (b) Should the company sell the units as scrap or rework them? (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Scrap Rework ces Cost of reworked units Income Incremental income (b) The company should: $ 0 $ 0A company must decide between scrapping or reworking units that do not pass inspection. The company has 16,000 defective units that have already cost $132,000 to manufacture. The units can be sold as scrap for $44,800 or reworked for $76,800 and then sold for $131,200. (a) Prepare a scrap or rework analysis of income effects. (b) Should the company sell the units as scrap or rework them? X Answer is complete but not entirely correct. (a) Scrap or Rework Analysis Scrap Rework Revenue from scrapped/reworked units $ 44,800 131,200 (76,800) 2$ Cost of reworked units Income $ 44,800 54,400 Incremental income $ 6,400 X (b) The company should: Rework the units
- -S Garcia Company has 10,500 units of its product that were produced at a cost of $157,500. The units were damaged in a rainstorm. Garcia can sell the units as scrap for $21,000, or it can rework the units at a cost of $39,500 and then sell them for $52,000. (a) Prepare a scrap or rework analysis of income effects. (b) Should Garcia sell the units as scrap or rework them and then sell them? (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Cost of reworked units Income Incremental income (b) The company should: Scrap ReworkGarcia Company has 10,400 units of its product that were produced at a cost of $156,000. The units were damaged in a rainstorm. Garcia can sell the units as scrap for $31,200, or it can rework the units at a cost of $49,600 and then sell them for $65,300. (a) Prepare a scrap or rework analysis of income effects. (b) Should Garcia sell the units as scrap or rework them and then sell them? (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Cost of reworked units Income Incremental income (b) The company should: F1 2 W S F2 # 3 E D 80 F3 MAR 29 $ 4 Scrap (0) R a F4 % 5 Rework ON F7 DII 8 1 FB ( 9 F9 F G H J KA company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 22,000 defective units that cost $6 per unit to manufacture. The units can be a) sold as is for $2.00 each, or b) reworked for $4.50 each and then sold for the full price of $8.50 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.) Sale as Scrap Rework Incremental income (loss) $ 2$ The company should:
- A company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 19,000 defective units that cost $5.20 per unit to manufacture. The units can be a) sold as is for $2.60 each, or b) reworked for $4.80 each and then sold for the full price of $7.80 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.) Incremental income (loss) The company should: Sale as Scrap $ 0 $ ReworkA company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 16,000 defective units that cost $5.70 per unit to manufacture. The units can be a) sold as is for $3.20 each, or b) reworked for $4.70 each and then sold for the full price of $8.90 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.)A company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 10,000 defective units that cost $5.30 per unit to manufacture. The units can be a) sold as is for $3.10 each, or b) reworked for $4.60 each and then sold for the full price of $8.40 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.) Incremental income (loss) The company should: Sale as Scrap Rework
- A company with excess capacity must decide between scrapping or reworking units that do not pass inspection. The company has 10,000 defective units that cost $5.30 per unit to manufacture. The units can be a) sold as is for $3.10 each, or b) reworked for $4.60 each and then sold for the full price of $8.40 each. What is the incremental income from selling the units as scrap and reworking and selling the units? Should the company sell the units as scrap or rework them? (Enter costs and losses as negative values.) Incremental income (loss) The company should: Sale as Scrap $Assume the company has 300 units left over from last year which have small defects. These units will have to be sold at a reduced price as scrap or thrown away. This would have no effect on the company's other sales. The variable selling and administrative costs would have to be incurred to sell the defective units. Identify whether the following costs are relevant or irrelevant then determine the minimum selling price for selling the defective units.A company must decide between scrapping or reworking units that do not pass inspection. The company has 22000 defective units that cost $6 per unit to manufacture. The units can be sold as is for $2.00 each or they can be reworked for $4.50 each and then sold for the full price of $8.50 each. If the units are sold as is the company will be able to build 22000 replacement units at a cost of $6 each and sell them at the full price of $8.50. (1) What is the incremental income from selling the units as scrap? (2) what is the incremental income from reworking and selling the units?(3) should the company sell the units as scrap or rework them?