Smith Petroleum has spent $201,000 to refine 61,000 gallons of petroleum distillate, which can be sold for $6.40 per gallon. Alternatively, Smith can process the distillate further and produce 53,000 gallons of cleaner fluid. The additional processing will cost $1.70 per gallon of distillate. The cleaner fluid can be sold for $9.20 per gallon. To sell cleaner fluid, Smith must pay a sales commission of $0.11 per gallon and a transportation charge of $0.20 per gallon. Should they sell the product as is or process further? Show the expected net revenue difference between the two alternatives. Should Smith sell the petroleum distillate or process it into cleaner fluid? Show the expected net revenue difference between the two alternatives. (Enter decreases to profits with a parentheses or minus sign. For the difference in total net revenue, use a parentheses or a minus sign if processing further will decrease total net revenue.) Expected revenue from selling 61,000 gallons of petroleum distillate Expected revenue from selling 53,000 gallons of cleaner fluid Additional costs of processing Total net revenue Decision: Sell As Is CITE Process Further Difference

Smith Petroleum has spent $201,000 to refine 61,000 gallons of petroleum distillate, which can be sold for $6.40 per gallon. Alternatively, Smith can process the distillate further and produce 53,000 gallons of cleaner fluid. The additional processing will cost $1.70 per gallon of distillate. The cleaner fluid can be sold for $9.20 per gallon. To sell cleaner fluid, Smith must pay a sales commission of $0.11 per gallon and a transportation charge of $0.20 per gallon. Should they sell the product as is or process further? Show the expected net revenue difference between the two alternatives. Should Smith sell the petroleum distillate or process it into cleaner fluid? Show the expected net revenue difference between the two alternatives. (Enter decreases to profits with a parentheses or minus sign. For the difference in total net revenue, use a parentheses or a minus sign if processing further will decrease total net revenue.) Expected revenue from selling 61,000 gallons of petroleum distillate Expected revenue from selling 53,000 gallons of cleaner fluid Additional costs of processing Total net revenue Decision: Sell As Is CITE Process Further Difference

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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AutoSave Off H Document2 - Word P Search (Alt+Q) Sign in File Design References Mailings Review View Help Grammarly Picture Format P Comments A Share Home Insert Draw Layout P Find - - A A Aa v A = - E - E G Times New Roman v 12 Normal No Spacing Heading 1 Replace = = 1E v Editor Open Grammarly Paste BIU I U v - 2. A - ab x, x' A . A Select v Undo Clipboard a Font Paragraph Styles Editing Editor Grammarly a. At the beginning of the year, Addison Company's assets are $200,000 and its equity is $150,000. During the year, assets increase $80,000 and liabilities increase $46,000. What is the equity at year-end? Assets Liabilities Equity Beginning $ 200,000 = 150,000 Change 80,000 = 46,000 + Ending Page 1 of 1 O words Text Predictions: On * Accessibility: Good to go O Focus 110% 9:58 PM P Type here to search 49°F 3/20/2022 近

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