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Question 1: A truck, costing $36,000 and uninsured, was wrecked the very first day it was used. The truck can either be disposed for $5,000 cash and replaced with a similar truck costing $32,000, or rebuilt for $19,000 and be "new" as far as operating characteristics and looks are concerned. The net relevant cost of the replacing option is:
Option 1: $25,000.
Option 2: $30,000.
Option 3: $32,000.
Option 4: $27,000.
Option 5: $10,000.
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The company's manufacturing overhead costs for the year are expected to be $720,000. Using the company's conventional costing system
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