11. Sell or Process Further

Sell or Process Further Calgary Lumber Company incurs a cost of $398 per hundred board feet (hbf) in processing certain "rough-cut" lumber, which it sells for $542 per hbf. An alternative is to produce a "finished-cut" at a total processing cost of $520 per hbf, which can be sold for $742 per hbf. a. Prepare a differential analysis dated Morch 15 on whether to sell rough-cut lumber (Alternative 1 ) or process further into finished-cut lumber (Alternative 2). Differential Analysis Sell Rough-Cut (Alt. 1) or Process Further into Finished-Cut (Alt, 2) b. Determine whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2 )