# Bunyon Lumber Company incurs a cost of $490 per hundred board feet in processing certain rough-cut lumber,

## Question:

Bunyon Lumber Company incurs a cost of $490 per hundred board feet in processing certain “rough-cut” lumber, which it sells for $635 per hundred board feet. An alternative is to produce a “finished cut” at a total processing cost of $565 per hundred board feet, which can be sold for $840 per hundred board feet. What is the amount of

(a) The differential revenue,

(b) Differential cost, and

(c) Differential income for processing rough-cut lumber into finished cut?

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