Question: additiona;l 4 A company must decide between scrapping or reworking units that do not pass Inspection. The company has 1 6 , 0 0 0

additiona;l4 A company must decide between scrapping or reworking units that do not pass Inspection. The company has 16,000 defective units
that have already cost $132,000 to manufacture. The units can be sold as scrap for $49,600 or reworked for $72,000 and then sold for
$137,600.
(a) Prepare a scrap or rework analysis of income effects.
(b) Should the company sell the units as scrap or rework them?
additiona;l4 A company must decide between scrapping or reworking units that

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