Sell or Process Further Calgary Lumber Company Incurs a cost of $388 per hundred board...
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Sell or Process Further Calgary Lumber Company Incurs a cost of $388 per hundred board feet (hbf) in processing certain "rough-cut" lumber, which it sells for $570 per hbf. An alternative is to produce a "finished-cut" at a total processing cost of $529 per hbf, which can be sold for $750 per hbf. a. Prepare a differential analysis dated March 15 on whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2). Differential Analysis Sell Rough-Cut (Alt. 1) or Process Further into Finished-Cut (Alt. 2) March 15 Process Further Differential Rough-Cut into Finished-Cut Effects (Alternative 1) (Alternative 2) (Alternative 2) Revenues, per 100 board ft. Costs, per 100 board ft. Sell Profit (Loss), per 100 board ft. b. Determine whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2). Sell rough-cut lumber Process further and sell finished-cut lumber
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