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question 56

Multiple Choice

[The following information applies to the questions displayed below.]
BT&T Corporation manufactures telephones.Recently,the company produced a batch of 600 defective telephones at a cost of $9,000.BT&T can sell these telephones as scrap for $9 each.It can also rework the entire batch at a cost of $6,500,after which the telephones could be sold for $20 per unit.
-Which of the following statements is false regarding the defective units?

• A)BT&T will not recover its costs if it sells the defective units as scrap.
• B)BT&T will recover total costs incurred if it reworks the defective units.
• C)BT&T will not recover its costs if it reworks the defective units.
• D)BT&T will recover more of its additional costs if it decides to rework the defective units.

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