ANSWER EXACTLY AS SHOWN IN THE CHART. Signal mistakenly produced 1,050 defective

Question

ANSWER EXACTLY AS SHOWN IN THE CHART.

Signal mistakenly produced 1,050 defective cell phones. The phones cost $63 each to produce. A salvage company will buy the defective phones as they are for $34 each. It would cost Signal $86 per phone to rework the phones. If the phones are reworked, Signal could sell them for $136 each. Assume there is no opportunity cost associated with reworking the phones. Compute the incremental net income from reworking the phones. Scrap Rework Sales Rework costs Total

Explanation / Answer

Scrap Rework Sales 35700 142800 Rework costs 90300 Total 35700 52500 Incremental income (loss) 16800

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