An unfinished desk is produced for $36.00 and sold for $65.00. A finished desk c

Question

An unfinished desk is produced for $36.00 and sold for $65.00. A finished desk can be sold for $75.00. The additional processing cost to complete the finished desk is $5.95. Provide a differential analysis for further processing. Round your answers to two decimal places, if necessary. Differential revenue from further processing: Revenue per unfinished desk Revenue per finished desk Differential revenue Differential cost per desk: Additional cost for producing Differential income from further processing

Explanation / Answer

Differencial revenue from further processing

Revenue per Unfinished desk=$65

Revenue per finished desk=$75

Differencial revenue=$10

Differencial cost for processing=$5.95

Differencial income From further processing=$4.05

Hence the company should go for further processing

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