Process or Sell

Product Tango is produced for $24 per gallon. Product Tango can be sold without additional processing for $40 per gallon, or processed further into Product Zulu at an additional cost of $9 per gallon. Product Zulu can be sold for $55 per gallon.

Question Content Area

a. Prepare a differential analysis dated October 3 on whether to sell Product Tango (Alternative 1) or process further into Product Zulu (Alternative 2). If required, use a minus sign to indicate a loss.

Differential Analysis Sell Product Tango (Alt. 1) or Process Further into Product Zulu (Alt. 2) October 3

Line Item Description	Sell Product Tango (Alternative 1)	Process Further into Product Zulu (Alternative 2)	Differential Effects (Alternative 2)
Revenues, per unit
Costs, per unit
Profit (loss), per unit