ficina Bonita Company manufactures office furniture. An unfinished desk is produced for $37.10 and sold for $65.45. A finished desk can be sold for $75.00. The additional processing cost to complete the finished desk is $6.30. Prepare a differential analysis. Round your answers to two decimal places. Differential AnalysisSell Unfinished (Alternative 1) or Process Further into Finished (Alternative 2) Desks Sell UnfinishedDesks(Alternative 1) Process Further intoFinished Desks(Alternative 2) DifferentialEffects(Alternative 2) Revenues per desk $ $ $ Costs per desk Profit (loss) per desk $ $ $ Should the company sell unfinished desks or process further and sell finished desks?Oficina Bonita Company should.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
ficina Bonita Company manufactures office furniture. An unfinished desk is produced for $37.10 and sold for $65.45. A finished desk can be sold for $75.00. The additional
Prepare a differential analysis. Round your answers to two decimal places.
| Differential Analysis Sell Unfinished (Alternative 1) or Process Further into Finished (Alternative 2) Desks |
|||
| Sell Unfinished Desks (Alternative 1) |
Process Further into Finished Desks (Alternative 2) |
Differential Effects (Alternative 2) |
|
| Revenues per desk | $ | $ | $ |
| Costs per desk | |||
| $ | $ | $ |
Should the company sell unfinished desks or process further and sell finished desks?
Oficina Bonita Company should.
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