Process or Sell Product F is produced for $3.34 per pound. Product F can be sold without additional processing for $4.04 per pound or processed further into Product G at an additional cost of $0.48 per pound. Product G can be sold for $4.38 per pound. Prepare a differential analysis dated November 15 on whether to Sell Product F (Alternative 1) or Process Further into Product G (Alternative 2). If required, round your answer to the nearest cent. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Sell Product F (Alt. 1) or Process Further into Product G (Alt. 2) November 15 Process Further into Sell Differential Product G Product F Effect (Alternative 2) (Alternative 1) (Alternative 2) Revenues, per unit 4.04 4.38 0.34 Costs, per unit -3.34 -3.82 -0.48 Profit (loss), per unit $ 0.7 0.56 -0.14 Should Product F be sold (Alternative 1) or processed further into Product G (Alternative 2)? Sell Product F

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 3BE: Make or buy A company manufactures various-sized plastic bottles for its medicinal product. The...
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Process or Sell
Product F is produced for $3.34 per pound. Product F can be sold without additional processing for $4.04 per pound or processed further into Product G at an additional cost of $0.48 per pound. Product G can be sold for $4.38 per pound.
Prepare a differential analysis dated November 15 on whether to Sell Product F (Alternative 1) or Process Further into Product G (Alternative 2). If required, round your answer to the nearest cent. For those boxes in which you must enter
subtracted or negative numbers use a minus sign.
Differential Analysis
Sell Product F (Alt. 1) or Process Further into Product G (Alt. 2)
November 15
Process
Further into
Sell
Differential
Product G
Product F
Effect
(Alternative 2)
(Alternative 1)
(Alternative 2)
Revenues, per unit
4.04
4.38
0.34
Costs, per unit
-3.34
-3.82
-0.48
Profit (loss), per unit
0.7
0.56
-0.14
Should Product F be sold (Alternative 1) or processed further into Product G (Alternative 2)?
Sell Product E
Transcribed Image Text:Process or Sell Product F is produced for $3.34 per pound. Product F can be sold without additional processing for $4.04 per pound or processed further into Product G at an additional cost of $0.48 per pound. Product G can be sold for $4.38 per pound. Prepare a differential analysis dated November 15 on whether to Sell Product F (Alternative 1) or Process Further into Product G (Alternative 2). If required, round your answer to the nearest cent. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Sell Product F (Alt. 1) or Process Further into Product G (Alt. 2) November 15 Process Further into Sell Differential Product G Product F Effect (Alternative 2) (Alternative 1) (Alternative 2) Revenues, per unit 4.04 4.38 0.34 Costs, per unit -3.34 -3.82 -0.48 Profit (loss), per unit 0.7 0.56 -0.14 Should Product F be sold (Alternative 1) or processed further into Product G (Alternative 2)? Sell Product E
Make or Buy
A restaurant bakes its own bread for a cost of $144 per unit (100 loaves), including fixed costs of $31 per unit. A proposal is offered to purchase bread from an outside source for $105 per unit, plus $7 per unit for delivery.
Prepare a differential analysis dated July 7 to determine whether the company should Make Bread (Alternative 1) or Buy Bread (Alternative 2), assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "0". For those boxes
in which you must enter subtracted or negative numbers use a minus sign.
Differential Analysis
Make Bread (Alt. 1) or Buy Bread (Alt. 2)
July 7
Make
Buy
Differential
Bread
Bread
Effect
(Alternative 1) (Alternative 2) (Alternative 2)
Unit Costs:
Purchase price
-105
-105
Delivery
-7
-7
Variable costs
-113
113
Fixed factory overhead
-31
-31
Total unit costs
-144
-143
1
Determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread.
Buy the bread
Transcribed Image Text:Make or Buy A restaurant bakes its own bread for a cost of $144 per unit (100 loaves), including fixed costs of $31 per unit. A proposal is offered to purchase bread from an outside source for $105 per unit, plus $7 per unit for delivery. Prepare a differential analysis dated July 7 to determine whether the company should Make Bread (Alternative 1) or Buy Bread (Alternative 2), assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Make Bread (Alt. 1) or Buy Bread (Alt. 2) July 7 Make Buy Differential Bread Bread Effect (Alternative 1) (Alternative 2) (Alternative 2) Unit Costs: Purchase price -105 -105 Delivery -7 -7 Variable costs -113 113 Fixed factory overhead -31 -31 Total unit costs -144 -143 1 Determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread. Buy the bread
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