Chapter 11, Problem 11E

Alderon Ltd. has 1,200 defective units of a product that cost $3.50 per unit in direct costs and $7.10 per unit in indirect costs when produced last year. The units can be sold as scrap for $4.80 per unit or reworked at an additional cost of $3.10 per unit and sold at the full price of $13.50. The incremental net income (loss) from the choice of reworking the units would be____.

Mangesh Analytics, Inc. sells earnings forecasts for European securities. Its credit terms are 2/15, net 40. Based on experience, 60 percent of all customers will take the discount. What is the average collection period? Need answer

What would be the cost per equivalent unit ?