B&B Flooring Produced 8,000 Yards of Its Economy-Grade Carpet

Multiple Choice

B&B Flooring produced 8,000 yards of its economy-grade carpet.In the coloring process, there was a pigment defect and the resulting color faded.The carpet normally sells for $18 per yard, with $6 of variable cost per yard and $3 of fixed cost per yard assigned to the carpet.The company realizes that it cannot sell the faded carpet for $18 per yard through its normal channels, unless the coloring process is repeated.The incremental cost of the coloring process is $4 per yard.Ace Apartments is willing to buy the carpet in its current faded condition for $13 per yard.Should B&B repeat the coloring process or sell the carpet to Ace Apartments?

A) Repeat coloring for $8,000 benefit
B) Sell 'as is' to Ace for $32,000 benefit
C) Repeat coloring for $56,000 benefit
D) Sell 'as is' to Ace for $56,000 benefit