Answer the following questions. A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined at total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable? Show your calculations. A truck, costing $101,500 and uninsured, is wrecked its first day in use. It can either (a) disposed of for $15,500 cash and replaced with a similar truck costing $102,000 or (b) rebuilt for $82,000, and thus be brand-new as far operating characteristics and looks are concerned. Which action is less costly? Show your calculations. 1. 2. 1. A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined at total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable? Show your calculations. (Only complete the necessary answer boxes.) Deduct: Operating income (a) Remachine (b) Scrap
Answer the following questions. A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined at total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable? Show your calculations. A truck, costing $101,500 and uninsured, is wrecked its first day in use. It can either (a) disposed of for $15,500 cash and replaced with a similar truck costing $102,000 or (b) rebuilt for $82,000, and thus be brand-new as far operating characteristics and looks are concerned. Which action is less costly? Show your calculations. 1. 2. 1. A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined at total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable? Show your calculations. (Only complete the necessary answer boxes.) Deduct: Operating income (a) Remachine (b) Scrap
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Answer the following questions.
A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined at total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable?
Show your calculations.
A truck, costing $101,500 and uninsured, is wrecked its first day in use. It can be either (a) disposed of for $15,500 cash and replaced with a similar truck costing $102,000 or (b) rebuilt for $82,000, and thus be brand-new as far as operating characteristics and looks are concerned. Which action is
less costly? Show your calculations.
1.
2.
1. A company has an inventory of 1,350 assorted parts for a line of missiles that has been discontinued. The inventory cost is $76,000. The parts can be either (a) remachined t total additional costs of $27,500 and then sold for $33,000 or (b) sold as scrap for $4,000. Which action is more profitable? Show your
calculations. (Only complete the necessary answer boxes.)
Deduct:
Operating income
(a)
Remachine
(b)
Scrap
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