Process or Sell

Product Tango is produced for $$3\mathrm{.}56$ per gallon. Product Tango can be sold without additional processing for $$4\mathrm{.}04$ per gallon, or processed further into Product Zulu at an additional cost of $$0\mathrm{.}47$ per gallon. Product Zulu can be sold for $$4\mathrm{.}34$ 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 $2).$ Round your answers to the nearest cent. 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 $Revenues, per unit

$Revenues, per unit

$Revenues, per unit

Costs, per unit Costs, per unit

Costs, per unit

Costs, per unit

Profit $($loss$),$ per unit $Profit $($loss$),$ per unit

$Profit $($loss$),$ per unit

$Profit $($loss$),$ per unit

Question Content Area

b$.$ Should Product Tango be sold $($Alternative $1)$ or processed further into Product Zulu $($Alternative $2)?$