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Gandy Company has 5,000 obsolete desk lamps that are carried in inventory at a manufacturing cost of $50,000. If the lamps are reworked for $20,000, they could be sold for $35,000. Alternatively, the lamps could be sold for $8,000 for scrap. In a decision model analyzing these alternatives, the sunk cost would be:

a) $8,000

b) $15,000

c) $20,000

d) $50,000

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M977986

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