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a.
Sell Regular
Columbian Into Decaf on Income
(Alternative 1) (Alternative 2) (Alternative 2)
Revenues
Costs
Income (loss)
b.
The differential revenue from processing further to Decaf Columbian is
the differential cost of processing further. Thus, Rise N’ Shine Coffee
process further into Decaf Columbian.
c.
The decrease in selling price of Decaf Columbian that would cause neither an advantage or
disadvantge for processing further:
The current selling price less the decrease would be:
Verify by completing the following differential analysis based on the new selling price:
Sell Regular
Columbian Into Decaf on Income
(Alternative 1) (Alternative 2) (Alternative 2)
Revenues
Costs
Income (loss)
Exercise 25-12
Name:
Section:
Volume of Decaf Columbian
[Key code here]
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Differential Analysis
Score:
Key Code:
Instructions
0%
Process Futher
Differential Effect
Sell Regular Columbian or Process Further into Decaf Columbian
October 6, 2014
Differential Effect
Process Futher
Net Advantage of Further Processing
=
=
An asterisk (*) will appear to the right of an incorrect entry, or above and below in formulas.
Enter a zero in cells you would otherwise leave blank.
a.
Sell Regular
Columbian Into Decaf on Income
(Alternative 1) (Alternative 2) (Alternative 2)
Revenues 55,320$ 67,716$ 12,396$
ON
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Score:
Instructions
Answers are entered in the cells with gray backgrounds.
Differential Effect
Exercise 25-12
Name:
Solution
Section:
October 6, 2014
Differential Analysis
Process Futher
Sell Regular Columbian or Process Further into Decaf Columbian
Process Futher
Differential Effect