Holmes Company produces a product that can either be sold as is or processed further....
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Holmes Company produces a product that can either be sold as is or processed further. Holmes has already spent $72,000 to produce 2,125 units that can be sold now for $81,500 to another manufacturer. Alternatively, Holmes can process the units further at an incremental cost of $295 per unit. If Holmes processes further, the units can be sold for $465 each. Compute the incremental income if Holmes processes further.
Sell as is Process Incremental Further Amount $ 988,125 $ 906,625 698,875 (026,875) Sales Additional processing costs Income (loss) $ 81,500 72.000 The company should
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