Walloon Company Produced 150 Defective Units Last Month at a Unit

question 5

Multiple Choice

Walloon Company produced 150 defective units last month at a unit manufacturing cost of $30. The defective units were discovered before leaving the plant. Walloon can sell them as is for $20 or can rework them at a cost of $15 and sell them at the regular price of $50. The total relevant cost of reworking the defective units is

• A) $4,500.
• B) $6,750.
• C) $7,500.
• D) $3,000.
• E) $2,250.

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Definitions:

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Sharps Container

A specially designed, hard-plastic container used for the safe disposal of needles, syringes, and other sharp objects to prevent injuries and infections.