heffield Corp. has several outdated computers that cost a total of $19400 and could be sold...

heffield Corp. has several outdated computers that cost a total of $19400 and could be sold as scrap for $6000. They could be updated for an additional $2500 and sold. If Sheffield updates the computers and sells them, net income will increase by $9000. What amount would be considered sunk costs? $19,400

Expert Solution

Sunk cost means, the cost which has been already incurred.

It can be stated as a historical cost.

In this question Sunk ckst is $19,400.

According to the given information,

Cost of the Outdated computers = $,19,400

Scrap value = $6,000

Increase in net income = $9,000

If High-tech computers are updated, then net income will increase by $9,000

If the computers are updated, then the scrap value will be the forgone cost which is also called the opportunity cost.

Hence, this cost must be added to the additional cost to determine the selling price.

We know that the selling price is calculated as

Selling price = Cost +Net income

=

(6000+2500)+9000

17500

ekkarill92 answered 2 years ago

Merchandiser Corp. has been in business for 40 years and values its cost of goods sold...

Merchandiser Corp. has been in business for 40 years and values its cost of goods sold and ending inventory using the LIFO costing method. The current year has been particularly unprofitable and Merchandiser Corp. is under significant investor pressure to finish the year with some good news. Merchandiser Corp's chief financial officer (CFO) has approached the president about a way to substantially increase earnings. She suggest that LIFO stop purchasing inventory the last couple months of the year. Since Merchandiser...

2. One week a computer store sold a total of 36 computers and external hard drives....

2. One week a computer store sold a total of 36 computers and external hard drives. The revenue from these sales was $25600. If computers sold for $1180 per unit and hard drives for $125 per unit, how many of each did the store sell? How many computers were sold? How many external hard drives were sold? 3. You invested $7000 between two accounts paying 3% and 9% annual interest, respectively. If the total interest earned for the year was...

Crosley Corp. sold an investment on an installment basis. The total gain of $60,000 was reported...

Crosley Corp. sold an investment on an installment basis. The total gain of $60,000 was reported for financial reporting purposes in the period of sale. The company qualifies to use the installment-sales method for tax purposes. The installment period is 3 years; one-third of the sale price is collected in the period of sale. The tax rate was 40% in 2017, and 35% in 2018 and 2019. The 35% tax rate was not enacted in law until 2018. The accounting...

Tiger Inc. has total sales of $8,821, cost of goods sold is $2,832, general and administrative...

Tiger Inc. has total sales of $8,821, cost of goods sold is $2,832, general and administrative expenses are $1,240, and depreciation is $523. The tax rate is 21 percent. The firm does not have any interest expense. What is the operating cash flow? Group of answer choices $3117.71 $3,859.65 $3,336.65 $3,751.71

Assume that Dell Corp has total liabilities of $18,000, and total assets of $26,000. It has...

Assume that Dell Corp has total liabilities of $18,000, and total assets of $26,000. It has sales of $10,000. If the profit margin is 11%, what is ROE (return on equity)? A) 13.75% B) 9.17% C) 1.25% D) There is not enough information, they cannot be calculated. E) There is enough information, but a, b, and c, are not correct.

Should we watch films with outdated and abusive language? Could you please answer this question Thanks...

Should we watch films with outdated and abusive language? Could you please answer this question Thanks :)

Holmes Inc. purchased computer equipment two years ago at a total cost of $1,000,000. These computers...

Holmes Inc. purchased computer equipment two years ago at a total cost of $1,000,000. These computers could be sold today for $300,000. If these computers are sold in five years, they will be worth $50,000. The CCA rate for these computers is 30%. The company is now considering whether it should replace these computers with newer and more powerful ones. The estimated total purchase cost of the new computers is $1.5 million. These computers can be sold for $300,000...

A dynamometer test lab currently has 45 computers with 20 printers. The computers cost $3,500 each...

A dynamometer test lab currently has 45 computers with 20 printers. The computers cost $3,500 each and the printers were $350 each when purchased 2 years ago. The market value of the computers is estimated at $750 each today and the printers $75 each today. It is expected that the current equipment will last another 4 years and have no salvage value at that time. Operating expenses are $350 for each computer and $150 for each printer per year. A...

a tool and a die company owns several models of lathes that have a total cost...

a tool and a die company owns several models of lathes that have a total cost of $15,000.000.00 a salvage value of $2750,000.00 and a life of five years. A.)Develop a table of depriciation and book values using double declining balance depriciation

1. The Industries has 50 obsolete desktop computers that are carried in inventory at a total...

1. The Industries has 50 obsolete desktop computers that are carried in inventory at a total cost of $27,800. If these computers are upgraded at a total cost of $12,000, they can be sold for a total of $32,000. As an alternative, the computers can be sold in their present condition for $12,200. The sunk cost in this situation is: 2. In order to maintain consistency, a cost that is relevant in one decision should be regarded as relevant in...

Question