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11 January, 03:32

Taylor Inc. has some material that originally cost $65,500. The material has a scrap value of $56,300 as is, but if reworked at a cost of $1,750, it could be sold for $55,700. What would be the financial advantage (disadvantage) of reworking and selling the material rather than selling it as is as scrap

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  1. 11 January, 03:39
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    -$2,350

    Explanation:

    In this question, we have to compare the cost which is shown below:

    If we considered the reworked cost, then the sales would be

    = Sales - reworked cost

    = $55,700 - $1,750

    = $53,950

    And the scrap value is $56,300

    So, the financial disadvantage would be

    = Sales without reworked cost - scrap value

    = $53,950 - $56,300

    = - $2,350

    All other information which is given is not relevant. Hence, ignored it
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