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 $ Net Income Increase (Decrease) -14 0
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 $ Net Income Increase (Decrease) -14 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text: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
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