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(Solved): The Best Bottling Company manufactures soda bottles that are recyclable. They have currently amassed ...



The Best Bottling Company manufactures soda bottles that are recyclable. They have currently amassed 320,000 defective bottles that can be sold "as is" at

$0.15

per bottle for scrap or they can correct the defect and sell the product at their regular price of

$0.70

per bottle. If the cost to process further and correct the defect they will incur additional costs of

$189,000

. What will be the net benefit to operating income if they process further?

A. The overall benefit to operating income will be a loss of

$13,000

.

B. The additional revenue will exceed the "as is" revenue by

$176,000

.

q,

C. The increase in additional costs will reduce the net benefit by

$189,000

. D. All of the above.

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