Assuming that the MR Corporation has an inventory of 200 defective motors costing $450,000 to produce and $150,000 to repair,the repaired units can be sold for $425,000.The company receives an offer to purchase these motors for $325,000 before repairing them.The company's decision should be to sell the motors at the offered price.

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Selling the motors at the offered price of $325,000 results in an immediate gain without incurring the additional $150,000 repair cost. Repairing and then selling them would only bring in $425,000, which, after deducting the $150,000 repair cost, results in a net of $275,000, making the offer to sell as-is more financially beneficial.

Assuming That the MR Corporation Has an Inventory of 200