Chapter 07: Applying Excel
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3	Data
4	Exhibit 7-6 Santa Maria Wool Cooperative
5	Cost of wool	$183,000
6	Cost of separation process	$40,000
7	Sales value of intermediate products at split-off point:
8	Undyed coarse wool	$130,000
9	Undyed fine wool	$126,000
10	Undyed superfine wool	$64,000
11	Costs of further processing (dyeing) intermediate products:
12	Undyed coarse wool	$50,000
13	Undyed fine wool	$60,000
14	Undyed superfine wool	$10,000
15	Sales value of end products:
16	Dyed coarse wool	$160,000
17	Dyed fine wool	$229,000
18	Dyed superfine wool	$94,000

c-1. With these new costs and selling prices, what recommendations would you make concerning the companys operations?

Sell as is or process further the intermidiate product undyed coarse wool? Ans. Sell as is

Sell as is or process further the intermidiate product undyed fine wool? Ans. Process further

Sell as is or process further the intermidiate product undyed superfine wool? Ans. Process further

C-2 If your recommendation in part (c-1) is followed, what would be the companys overall profit?