The Lantern Corporation has 1,000 obsolete lanterns that are carried in inventory at a manufacturing cost of $20,000. If the lanterns are re-machined for $5,000 they could be sold for $9,000. Alternatively, the lanterns could be sold for scrap for $1,000. Which alternative is more desirable, and what are the total relevant costs for that alternative?

a. Re-machine and $ 5,000.

b. Re-machine and $25,000.

c. Scrap and $20,000.

d. Scrap and $19,000.

Answer rating: 100% (QA)

Step1 Hence the correct answer is a Re machine and 5000 For... View the full answer