Determining the sunk cost, Accounting Basics

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Determining the sunk cost

The Tingey Company has 500 obsolete microcomputers that are carried in inventory at a total cost of $720,000. If these microcomputers are upgraded at a total cost of $100,000, they can be sold for a total of $160,000. As an alternative, the microcomputers can be sold in their present condition for $50,000.

a.The sunk cost in this situation is

b. What is the net advantage or disadvantage to the company from upgrading the computers rather than selling them in their present condition?

A. $110,000 advantage
B. $660,000 disadvantage
C. $10,000 advantage
D. $60,000 advantage

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Accounting Basics: Determining the sunk cost

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Accounting Basics: Determining the sunk cost

Reference No:- TGS046133

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Recent Questions Asked Accounting Basics

Q : Calculate austin agi and taxable income

Q : Net gain-loss for each headlight

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Ask an Expert for Answer!!

Accounting Basics: Determining the sunk cost

Reference No:- TGS046133

Recent Questions Asked Accounting Basics

Q : Calculate austin agi and taxable income

Q : Net gain-loss for each headlight

Q : Cost of making the component-price of buying the component

Q : Overall net operating income would increase-decrease

Q : Determining the sunk cost

Q : Weighted average shares outstanding problem

Q : What amount of gross profit should it recognize

Q : Determine the amount of the deduction for salaries

Q : Amortization schedule for the lease terms

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