Rosen, Inc. has 10,000 obsolete calculators, which are carried in inventory at a cost of $20,000. If the calculators are scrapped, they can be sold for $1.10 each (for parts). If they are repackaged, at a cost of $15,000, they could be sold to toy stores for $2.50 per unit. What alternative should be chosen, and why?
A. Repackage; revenue is $5,000 greater than cost.
B. Scrap; incremental loss is $9,000.
C. Repackage; receive profit of $10,000.
D. Scrap; profit is $1,000 greater.
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