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Exercise 25-4 (Algo) Scrap or rework LO P2 A company must decide between scrapping or reworking units that do not pass Inspection. The company has 19,000 defective units that have already cost $132,000 to manufacture. The units can be sold as scrap for $55,100 or reworked for $85,500 and then sold for $157,700 (a) Prepare a scrap or rework analysis of income effects. (b) Should the company sell the units as scrap or rework them? Scrap Rework (a) Scrap or Rework Analysis Revenue from scrapped/reworked units Cost of reworked units Income incremental income ces (b) The company should Exercise 25-5 (Algo) Sell or process LO P2 Varto Company has 9,600 units of its product in inventory that it produced last year at a cost of $156,000. This year's model is better than last year's, and the 9,600 units cannot be sold at last year's normal selling price of $51 each. Varto has two alternatives for these units: (1) They can be sold as is to a wholesaler for $134,400 or (2) they can be processed further at an additional cost of $161,000 and then sold for $288,000 (a) Prepare a sell as is or process further analysis of income effects. (b) Should Varto sell the products as is or process further and then sell them? Sell As Is Process Further (m) Sell or Process Analysis Revenue Costs Income Incremental income (ons) to sell as is (6) The company should S 25-12 (Algo) Sales mix analysis LO P3 Surf Company can sell all of the two surfboard models it produces, but it has only 404 direct labor hours available. The Glide model requires 2 direct labor hours per unit. The Ultra model requires 4 direct labor hours per unit. Contribution margin per unit is $204 for Glide and $308 for Ultra. (a) Compute the contribution margin per direct labor hour for each product (b) Determine the best sales mix and the resulting contribution margin. Complete this question by entering your answers in the tabs below. Required A Required B Compute the contribution margin per direct lobor hour for each product, Ultra Contribution margin per direct labor hour Required Glide QS 25-12 (Algo) Sales mix analysis LO P3 Surf Company can sell all of the two surfboard models it produces, but it has only 404 direct labor hours available. The Glide model requires 2 direct labor hours per unit. The Ultra model requires 4 direct labor hours per unit. Contribution margin per unit is $204 for Glide and $308 for Ultra (a) Compute the contribution margin per direct labor hour for each product. (b) Determine the best sales mix and the resulting contribution margin Complete this question by entering your answers in the tabs below. Required Required B Determine the best sales mix and the resulting contribution margin Gilde Ultra Number of units Contribution margin

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