QS 23-3 (Algo) Identifying relevant costs LO C1Zycon has produced 8,000 units of raw milk at a $16,000 cost. These units can be sold as is to another manufacturer for $9,600.Instead, Zycon can process the units further and produce yogurt. Processing further will cost an additional $12,800 and will yieldrevenues of $24,000.Identify whether each of the following is relevant or not relevant to the sell or process further decision.Itema. $16,000 cost already incurred to produce milkb. $9,600 selling price for milk as isc. $12,800 further processing costsd. $24,000 revenue from further processing

Businesses can make well-informed and strategic decisions by taking into account only the factors…

QS 23-3 (Algo) Identifying relevant costs LO C1 Zycon has produced 8,000 units of raw milk at a $16,000 cost. These units can be sold as is to another manufacturer for $9,600. Instead, Zycon can process the units further and produce yogurt. Processing further will cost an additional $12,800 and will yield revenues of $24,000.

QS 23-3 (Algo) Identifying relevant costs LO C1 Zycon has produced 8,000 units of raw milk at a $16,000 cost. These units can be sold as is to another manufacturer for $9,600. Instead, Zycon can process the units further and produce yogurt. Processing further will cost an additional $12,800 and will yield revenues of $24,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Example 1Assume that Grace Company presently produces and sells 20,000 units of product A which represents only 80% of its normal capacity of 25,000 units. Its regular selling price is P50 per unit and its manufacturing, selling and administrative costs are as follows:Materials P10Labor 12Variable OH 8Fixed OH 60,000Variable selling and administrative 7Fixed selling and administrative 40,000 Grace Company received an order from a provincial distributor for 3,000 units. The customer asks for a special discount of 30%. It is expected that the company will incur no additional selling and administrative costs. Should Grace company accept the special order?
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Homework, Chapter 25 Process or Sell Product J19 is produced for $3.42 per gallon. Product J19 can be sold without additional processing for $4.10 per gallon, or processed further into Product R33 at an additional cost of $0.48 per gallon. Product R33 can be sold for $4.54 per gallon. a. Prepare a differential analysis dated April 30 on whether to sellI Product J19 (Alternative 1) or process further into Product R33 (Alternative 2). Round your answers to the nearest cent. If required, use a minus sign to indicate a loss. Differential Analysis Sell Product J19 (Alt. 1) or Process Further into Product R33 (Alt. 2) April 30 Process Sell Differential Further into Product J19 Effects Product R33 (Alternative 1) (Alternative 2) (Alternative 2) Revenues, per unit $ Costs, per unit Profit (loss), per unit b. Should Product J19 be sold (Alternative 1) or processed further into Product R33 (Alternative 2)?