MANAGERIAL ACCOUNTING FUND. W/CONNECT
MANAGERIAL ACCOUNTING FUND. W/CONNECT
5th Edition
ISBN: 9781259688713
Author: Wild
Publisher: MCG
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Chapter 10, Problem 9QS

Signal mistakenly produced 1,000 defective cell phones. The phones cost $60 each to produce. A salvage company will buy the defective phones as they are for $30 each. It would cost Signal $80 per phone to rework the phones. If the phones are reworked, Signal could sell them for $120 each. Assume there is no opportunity cost associated with reworking the phones. Compute the incremental net income from reworking the phones.

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Signal mistakenly produced 1,375 defective cell phones. The phones cost $62 each to produce. A salvage company will buy the defective phones as they are for $35 each. It would cost Signal $82 per phone to rework the phones. If the phones are reworked. Signal could sell them for $136 each. Signal has excess capacity. Should Signal scrap or rework the phones? Sales Rework costs Income Increase net income by Scrap Rework
Signal mistakenly produced 1,400 defective cell phones. The phones cost $63 each to produce. A salvage company will buy the defective phones as they are for $33 each. It would cost Signal $88 per phone to rework the phones. If the phones are reworked, Signal could sell them for $132 each. Signal has excess capacity. Should Signal scrap or rework the phones? Serap Rework Sales Rework costs Income
BT&T Corporation manufactures telephones. Recently , the company produced a batch of 600 defective telephones at a cost of $9,000. BT &T can sell these telephones as scrap for $9 each. It can also rework the entire batch at a cost of $6,500 , after which the telephones could be sold for $20 per unit. If BT&T reworks the defective telephones , by how much will its operating income change ?

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MANAGERIAL ACCOUNTING FUND. W/CONNECT

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