1 Sandhill Street Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it hasunused capacity, Sandhill Street is considering finishing the bookcases and selling them for $73. Variable finishing costs are expectedto be $6 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Sandhill Street should sellunfinished or finished bookcases. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)ProcessSellFurtherSales price per unit$$Cost per unitNet IncomeIncrease (Decrease)VariableFixedTotalNet income per unitThe bookcases$+A

In this case the differential analysis would be used to determine whether company should sell or…

Answered: Sandhill Street Inc. makes unfinished…

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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Wildhorse Street Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it has unused capacity, Wildhorse Street is considering finishing the bookcases and selling them for $73. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Wildhorse Street should sell unfinished or finished bookcases. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Sales price per unit Cost per unit Variable Fixed Total $ Net income per unit $ Sell The bookcases should be processed further 59 38 10 48 11 $ $ Process Further 73 10 $ $ Net Income Increase (Decrease) -14 0
Carla Vista Street Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it has unused capacity, Carla Vista Street is considering finishing the bookcases and selling them for $73. Variable finishing costs are expected to be $6 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Carla Vista Street should sell unfinished or finished bookcases. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Process Net Income Sell Further Increase (Decrease) Sales price per $ $ 2$ unit Cost per unit Variable Fixed Total Net income 2$ 24 $ per unit The bookcases
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Pine Street Inc. makes unfinished bookcases that it sells for $57. Production costs are $38 variable and $10 fixed. Because it has unused capacity. Pine Street is considering finishing the bookcases and selling them for $72. Variable finishing costs are expected to be $8 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Pine Street should sell unfinished or finished bookcases. (Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. (45)) Sales price per unit Cost per unit Variable Fixed Total Net income per unit $ The bookcases Sell Process Further Net Income Increase (Decrease)
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Cullumber Street Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it has unused capacity, Cullumber Street is considering finishing the bookcases and selling them for $75. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Cullumber Street should sell unfinished or finished bookcases. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Sales price per unit Cost per unit Variable Fixed Total Net income per unit The bookcases +A Sell +A $ $ $ Process Further +A $ Net Income Increase (Decrease) +A $
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Pine Street Inc. makes unfinished bookcases that it sells for $62. Production costs are $36 variable and $10 fixed. Because it has unused capacity, Pine Street is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $6 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Pine Street should sell unfinished or finished bookcases.
Sheridan manufactures unpainted furniture for the do-it-yourself market. It currently sells a table for $65. Production costs are $35 variable and $10 fixed. Sheridan is considering staining and sealing the table to sell it for $100. Variable costs to finish each table are expected to be $13, and fixed costs are expected to be $1. Prepare an analysis showing whether Sheridan should sell unpainted or finished tables. (If an amount reduces the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).) Incremental revenue $ Incremental cost $ Increase (decrease) in contribution margin Sheridan eTextbook and Media process the tables further. Net Income Increase (Decrease) SUPPORT
Meg's Manufacturing Company can make 211 units of a component part for variable costs of $159,896 and fixed costs of $32,104. The compnay decides the buy the part externally instead for $153,734 and $4,789 of the fixed costs will be avoided. How much will net income increase or decrease? If net income increases, make your answer positive; If net income decreases, put a (-) negative sign in front of the answer. Round your answer to the nearest whole dollar and do not type the dollar sign.

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