Product T is produced for $3.34 per pound. Product T can be sold without additio

ID: 2573709 • Letter: P

Question

Product T is produced for $3.34 per pound. Product T can be sold without additional processing for $4.17 per pound, or processed further into Product U at an additional cost of $0.47 per pound. Product U can be sold for $4.34 per pound.

Prepare a The area of accounting concerned with the effect of alternative courses of action on revenues and costs.differential analysis dated September 17, on whether to sell T (Alternative 1) or process further into U (Alternative 2). If required, round your answers to the nearest whole dollar.

Should Product T be sold (Alternative 1) or processed further into Product U (Alternative 2)?

Differential Analysis Sell Product T (Alt. 1) or Process Further into Product U (Alt. 2) September 17 Sell Product T (Alternative 1) Process Further into Product U (Alternative 2) Differential Effect on Income (Alternative 2) Revenues, per pound $ $ $ Costs, per pound Income (Loss), per pound $ $ $

Explanation / Answer

Sell product T Further process Differencial effect Product U on income Revenue , per pound 4.17 4.34 0.17 Cost per pound 3.34 3.81 -0.47 Income(loss) per pound 0.83 0.53 -0.3 Should be sold at alternative 1

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Product T is produced for $3.34 per pound. Product T can be sold without additio

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