Collins Company has some outdated products that originally cost $80,000 to make. The products have a current resale value of $36,000 as is, but if reworked at a cost of $20,000, they could be sold for $60,000. What is the financial advantage or disadvantage of reworking the products? a)$4,000 financial advantage b)$16,000 financial advantage c)$6,000 financial disadvantage d)$20,000 financial disadvantage
Collins Company has some outdated products that originally cost $80,000 to make. The products have a current resale value of $36,000 as is, but if reworked at a cost of $20,000, they could be sold for $60,000. What is the financial advantage or disadvantage of reworking the products? a)$4,000 financial advantage b)$16,000 financial advantage c)$6,000 financial disadvantage d)$20,000 financial disadvantage
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Collins Company has some outdated products that originally cost $80,000 to make. The products have a current resale value of $36,000 as is, but if reworked at a cost of $20,000, they could be sold for $60,000. What is the financial advantage or disadvantage of reworking the products?
a)$4,000 financial advantage
b)$16,000 financial advantage
c)$6,000 financial disadvantage
d)$20,000 financial disadvantage
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