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Windsor Inc. makes unfinished bookcases that it sells for $60. Production costs are $38 variable and $9 fixed. Because it has unused capacity, Windsor is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per-unit basis that shows whether Windsor should sell unfinished or finished bookcases. (If an amount reduce the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).)

Windsor Inc. makes unfinished bookcases that it sells for $60. Production costs are $38 variable and $9 fixed. Because it has unused capacity, Windsor is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per-unit basis that shows whether Windsor should sell unfinished or finished bookcases. (If an amount reduce the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).)

FINANCIAL ACCOUNTING
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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Windsor Inc. makes unfinished bookcases that it sells for $60. Production costs are $38 variable and $9 fixed. Because it has unused capacity, Windsor is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per-unit basis that shows whether Windsor should sell unfinished or finished bookcases. (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).) Sales per unit Variable cost per unit Fixed cost per unit Total per unit cost Net income per unit The bookcases $ CA $ LA Sell processed further. $ +A $ LA Process Further $ tA tA $ Net Income Increase (Decrease)
Transcribed Image Text:Windsor Inc. makes unfinished bookcases that it sells for $60. Production costs are $38 variable and $9 fixed. Because it has unused capacity, Windsor is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $7 per unit with no increase in fixed costs. Prepare an analysis on a per-unit basis that shows whether Windsor should sell unfinished or finished bookcases. (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).) Sales per unit Variable cost per unit Fixed cost per unit Total per unit cost Net income per unit The bookcases $ CA $ LA Sell processed further. $ +A $ LA Process Further $ tA tA $ Net Income Increase (Decrease)
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