10:13 Tawstir Corporation has 800 obsolete personal computers that are carried i

Question

10:13

Tawstir Corporation has 800 obsolete personal computers that are carried in inventory at a total cost of $1,100,000. If these computers are upgraded at a total cost of $40,000, they can be sold for a total of $750,000. As an alternative, the computers can be sold in their present condition for $690,000. Suppose the selling price of the upgraded computers has not been set. At what selling price per unit would the company be as well off upgrading the computers as if it just sold the computers in their present condition?

Explanation / Answer

Answer : d: $ 562.50

1140000 - 690000 / 800 = $562.50.

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