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.
Answer to relevant QuestionsIdentify each of the following terms/phrases as either an accounting: (a) Principle, (b) Assumption, (c) Constraint. 1. Materiality 2. Time period 3. Benefit exceeds cost 4. Revenue recognition A company has already incurred $5,000 of costs in producing 6,000 units of Product XY. Product XY can be sold as is for $15 per unit. Instead, the company could incur further processing costs of $8 per unit and sell the ...Refer to the information in Exercise. Assume the company requires a 10% rate of return on its investments. Compute the net present value of each potential investment. (Round to the nearest dollar.) In exercise a. A new ...Samsung must assign overhead costs to its products. Activity-based costing is generally considered more accurate than other methods of assigning overhead. If this is so, why do all manufacturers not use it? Bill Padley expects to invest $10,000 for 25 years, after which he wants to receive $108,347. What rate of interest must Padley earn?
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