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Maps Translate News e Chrome Web Store wc MyEagles Personeext Houston Communitwe 5.1 Simple Interest.. Help Se Harold Manufac
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Answer #1

The Manufacturing Cost of 5100 Denim Jackets is a sunk cost and hence irrelevant in decision making.

Calculating Incremental Income for each alternative

Alternative 1. Sell to a secondhand shop
Particulars Calculations Amount ($)
Incremental Revenue ( $8 x 5100) $40,800
Less:- Incremental Costs $0
Incremental Incomes $40,800
Alternative 2. Disassemble and sell to a recycler.
Particulars Calculations Amount ($)
Incremental Revenue ( $11 x 5100) $56,100
Less:- Incremental Costs Given $31,500
Incremental Incomes $24,600
Alternative 3. Rework and sell at regular prices.
Particulars Calculations Amount ($)
Incremental Revenue ( $44 x 2910) $128,040
Less:- Incremental Costs Given $102,700
Incremental Incomes $25,340

Recommendation :- The best alternative is to sell 5100 Denim jackets (damaged) to the secondhand clothing shop at $8.00 each.

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