Cobe Company nas manufactured 200 partially finished cabinets at a cost of $50,000, These can be sold as is for $60,000. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $12.000, and the Tinished cabinets could be sold for $80,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should the cabinets be sold as is or processed further and then sold? O Answer is complete but not entirely correct. (a)Sell or Process Analysis Process Further Sell As is Revenue 00,000 Os s0.000 Costs 02000 O 12.000 O Income 10.000 Os 18.000 O Incrementa income (loss) to process further 8,000 (b) The company should Process further

Cobe Company nas manufactured 200 partially finished cabinets at a cost of $50,000, These can be sold as is for $60,000. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $12.000, and the Tinished cabinets could be sold for $80,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should the cabinets be sold as is or processed further and then sold? O Answer is complete but not entirely correct. (a)Sell or Process Analysis Process Further Sell As is Revenue 00,000 Os s0.000 Costs 02000 O 12.000 O Income 10.000 Os 18.000 O Incrementa income (loss) to process further 8,000 (b) The company should Process further

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 5P: Hudson Corporation is considering three options for managing its data warehouse: continuing with its...

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Hudson Corporation is considering three options for managing its data warehouse: continuing with its own staff, hiring an outside vendor to do the managing, or using a combination of its own staff and an outside vendor. The cost of the operation depends on future demand. The annual cost of each option (in thousands of dollars) depends on demand as follows: If the demand probabilities are 0.2, 0.5, and 0.3, which decision alternative will minimize the expected cost of the data warehouse? What is the expected annual cost associated with that recommendation? Construct a risk profile for the optimal decision in part (a). What is the probability of the cost exceeding $700,000?
Cobe Company has manufactured 200 partially finished cabinets at a cost of $50,000. These can be sold as is for $60,000. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $12,000, and the finished cabinets could be sold for $80,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should the cabinets be sold as is or processed further and then sold? (a) Sell or Process Analysis Revenue Costs Income Incremental income (loss) to process further (b) The company should: Sell As Is Process Further
Cobe Company has manufactured 225 partially finished cabinets at a cost of $56,250. These can be sold as is for $67,500. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $13,500, and the finished cabinets could be sold for $90,000.(a) Prepare a sell as is or process further analysis of income effects.(b) Should the cabinets be sold as is or processed further and then sold?
Cobe Company has manufactured 255 partially finished cabinets at a cost of $63,750. These can be sold as is for $76,500. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $15,300, and the finished cabinets could be sold for $102,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should the cabinets be sold as is or processed further and then sold? (a) Sell or Process Analysis Sell As Is Process Further Revenue Costs Income Incremental income (loss) to process further (b) The company should:
Holmes Company has already spent $66,000 to harvest peanuts. Those peanuts can be sold as is for $71,500. Alternatively, Holmes can process further into peanut butter at an additional cost of $350,000. If Holmes processes further, the peanut butter can be sold for $500,000. (a) Prepare a sell as is or process further analysis of income effects. (b) Should Holmes sell as is or process further? (a) Sell or Process Analysis Revenue Costs Income (b) The company should: F1 @ 2 W F2 # 3 E Sell as is Process Further 80 F3 MAR 29 $ 4 R a F4 % 5 U 8 DII FB 1 9 F9 H H J K A F10
Holmes Company has already spent $56,000 to harvest peanuts. Those peanuts can be sold as is for $81,500. Alternatively, Holmes can process further into peanut butter at an additional cost of $390,000. If Holmes processes further, the peanut butter can be sold for $660,000.(a) Prepare a sell as is or process further analysis of income effects.(b) Should Holmes sell as is or process further? (a) Sell or Process Analysis Sell as is Process Further Revenue Costs Income (b) The company should: Process further
is Holmes Company has already spent $94,000 to harvest peanuts. Those peanuts can be sold as is for $79,500. Alternatively, Holmes can process further into peanut butter at an additional cost of $582,625. If Holmes processes further, the peanut butter can be sold for $967,750. (a) Prepare a sell as is or process further analysis of income effects. (b) Should Holmes sell as is or process further? (a) Sell or Process Analysis Revenue Costs Income (b) The company should: Sell as is Process Further
Hazel Company makes an unassembled product that it currently sells for $55. Production costs are $20. Hazel is considering assembling the product and selling it for $68. The cost to assemble the product is estimated at $12. What decision should Hazel make? A) Sell before assembly; net income per unit will be $12 greater. B) Sell before assembly; net income per unit will be $1 greater. C) Process further; net income per unit will be $13 greater. D) Process further; net income per unit will be $1 greater. 24 E) none of the above
Kobe Company has manufactured 200 partially finished cabinets at a cost of $102,000. These can be sold as is for $122,400. Instead, the cabinets can be stained and fitted with hardware to make finished cabinets. Further processing costs would be $24,500, and the finished cabinets could be sold for $163,200. If Kobe Company processes the cabinets further, incremental income is:
A company has already spent $5,180 to harvest tomatoes. The tomatoes can be sold as is for $93,240. Instead, the company could incur further processing costs of $49,700 and sell the resulting salsa for $130,500. Prepare a sell as is or process further analysis of income effects.
Chang Industries has already spent $230,000 to produce tables. Those tables can be sold as is for SA42000. Alternatively, the tables can be processed a stain for an additional cost of $150,00O. The stained tables can be sold for $620,000. Chang should: Multiple Choice Sell unfinished tables for incremental revenue of $212,00. Sell the unfinished tables for incremental income of $390,000. Finish the tables for incremental cost of $380,000. Finish the tables for incremental income of $178,000. Finish the tables for incremental income of $28,000.
Vaughn Manufacturing is starting business and is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $65 and Vaughn Manufacturing would sell it for $145. The cost to assemble the product is estimated at $28 per unit and Vaughn Manufacturing believes the market would support a price of $178 on the assembled unit. What is the correct decision using the sell or process further decision rule and why? Process further because profits will be greater by $33 per unit. Sell before assembly because profits will be greater by $33 per unit. Sell before assembly because profits will be greater by $28 per unit. O Process further because profits will be greater by $5 per unit. eTextbook and Media Save for Later Attempts: 2 of 3 used Submit Answer