The Lantern Corporation Has 1,000 Obsolete Lanterns That Are Carried

Multiple Choice

The Lantern Corporation has 1,000 obsolete lanterns that are carried in inventory at a manufacturing cost of $20,000.If the lanterns are re-machined for $5,000,they could be sold for $9,000.Alternatively,the lanterns could be sold for scrap for $1,000.Which alternative is more desirable,and what are the total relevant costs for that alternative?

A) Re-machine and $5,000.
B) Re-machine and $25,000.
C) Scrap and $20,000.
D) Scrap and $19,000.