Tawstir Corporation has 400 obsolete personal computers that are carried in inve
ID: 2472377 • Letter: T
Question
Tawstir Corporation has 400 obsolete personal computers that are carried in inventory at a total cost of $576,000. If these computers are upgraded at a total cost of $180,000, they can be sold for a total of $240,000. As an alternative, the computers can be sold in their present condition for $40,000.
What is the net advantage or disadvantage to the company from upgrading the computers rather than selling them in their present condition?
Tawstir Corporation has 400 obsolete personal computers that are carried in inventory at a total cost of $576,000. If these computers are upgraded at a total cost of $180,000, they can be sold for a total of $240,000. As an alternative, the computers can be sold in their present condition for $40,000.
Explanation / Answer
$20,000 advantage
Sell Process Further Revenue $40,000 $240,000 Upgrade cost 0 ($180,000) $40,000 $60,000Related Questions
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