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?
BT&T will recover total costs incurred if it reworks the defective units.
BT&T will not recover its costs if it sells the defective units as scrap.
BT&T will not recover its costs if it reworks the defective units.
BT&T will recover more of its additional costs if it decides to rework the defective units.