Process or SellProduct A is produced for $3.58 per pound. Product A can be sold without additional processing for $4.1 per pound or processed further into Product B at an additional cost of $0.47 per pound. Product B can be sold for $4.4 per pound.Prepare a differential analysis dated November 15 on whether to sell A (Alternative 1) or process further into B (Alternative 2). If required, round your answers to the nearest whole dollar. For those boxes in which you must enter subtracted or negative numbers use a minus sign.Differential AnalysisSell Product A (Alt. 1) or Process Further into Product B (Alt. 2)November 15 Sell Product A(Alternative 1)Process Furtherinto ProductB (Alternative 2)Differential Effecton Income(Alternative 2)Revenues, per unit$fill in the blank 50d2fef42fcd026_1$fill in the blank 50d2fef42fcd026_2$fill in the blank 50d2fef42fcd026_3Costs, per unitfill in the blank 50d2fef42fcd026_4fill in the blank 50d2fef42fcd026_5fill in the blank 50d2fef42fcd026_6Income (Loss), per unit$fill in the blank 50d2fef42fcd026_7$fill in the blank 50d2fef42fcd026_8$fill in the blank 50d2fef42fcd026_9Should Product A be sold (Alternative 1) or processed further into Product B (Alternative 2)?

The question is based on the concept of Cost Accounting.

Answered: Product A is produced for $3.58 per…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 17E

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Process or Sell

Product A is produced for $3.58 per pound. Product A can be sold without additional processing for $4.1 per pound or processed further into Product B at an additional cost of $0.47 per pound. Product B can be sold for $4.4 per pound.

Prepare a differential analysis dated November 15 on whether to sell A (Alternative 1) or process further into B (Alternative 2). If required, round your answers to the nearest whole dollar. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Differential Analysis
Sell Product A (Alt. 1) or Process Further into Product B (Alt. 2)
November 15
	Sell Product A (Alternative 1)	Process Further into Product B (Alternative 2)	Differential Effect on Income (Alternative 2)
Revenues, per unit	$fill in the blank 50d2fef42fcd026_1	$fill in the blank 50d2fef42fcd026_2	$fill in the blank 50d2fef42fcd026_3
Costs, per unit	fill in the blank 50d2fef42fcd026_4	fill in the blank 50d2fef42fcd026_5	fill in the blank 50d2fef42fcd026_6
Income (Loss), per unit	$fill in the blank 50d2fef42fcd026_7	$fill in the blank 50d2fef42fcd026_8	$fill in the blank 50d2fef42fcd026_9

Should Product A be sold (Alternative 1) or processed further into Product B (Alternative 2)?

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