5 nts Exercise 25-5 (Algo) Sell or process LO P2 Varto Company has 8,000 units of its product in inventory that it produced last year at a cost of $158,000. This year's model is better than last year's, and the 8,000 units cannot be sold at last year's normal selling price of $53 each. Varto has two alternatives for these units: (1) They can be sold as is to a wholesaler for $112,000 or (2) they can be processed further at an additional cost of $94,200 and then sold for $200,000. eBook Hint (a) Prepare a sell as is or process further analysis of income effects. (b) Should Varto sell the products as is or process further and then sell them? Print eferences (a) Sell or Process Analysis Sell As Is Process Further Revenue Costs Income Incremental income (loss) to sell as is (b) The company should: $ 0 $ 0

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24.2 Jabu manufactures and sells Product X.  During the most recent financial period, he sold 500 units at R750 each.  There were no units of Product X in opening or closing inventory.  Sales people are paid a commission of 5% on sales.  The following additional information is available for this sales level: Fixed administrative cost per unit                           R90.00 Total fixed manufacturing overhead                     R120 000 Total fixed marketing cost                                    R50 000 Direct material usage per product                          2 kg Direct material price per kilogram                        R14.50 Total direct labour cost                                         R47 500   Required:   All manufacturing cost increases with 10%.  The marketing director estimates that sales volume will increase with 5% if an advertising campaign of R10 000 is undertaken.  What is the operating income for Jabu?  Refer to above.  Do you think that it is viable for Jabu to…

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Exercise 23-5 (Algo) Sell or process LO P2 Varto Company has 12.200 units of its product in inventory that it produced last year at a cost of $156,000. This year's model is better than last year's, and the 12.200 units cannot be sold at last year's normal selling price of $41 each. Varto has two alternatives for these units ( They can be sold as is to a wholesaler for $109.800 or (2) they can be processed further at an additional cost of $312.100 and then sold for $414,800 (e) Prepare a sell as is or process further analysis of income effects (b) Should Varto sell the products as is or process further and then sell them? Sell or Process Analysis Cests Incremental income foss) to sell as is (b) The company should $ Sell Ass Sell as i 05 Process Forther

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