Calgary Lumber Company incurs a cost of $370 per hundred board feet (hbf) in processing certain "rough-cut" lumber, which it sells for $548 per hbf. An alternative is to produce a "finished-cut" at a total processing cost of $522 per hbf, which can be sold for $744 per hbf. a. Prepare a differential analysis dated March 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) March 15 Sell Rough-Cut Process Further Differential into Finished-Cut (Alternative 1) (Alternative 2) Effects (Alternative 2) Revenues, per 100 board ft. $ $ $ Costs, per 100 board ft. Profit (Loss), per 100 board ft. b. Determine whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2). Toyota Motor Corporation uses target costing. Assume that Toyota marketing personnel estimate that the competitive selling price for the Camry in the upcoming model year will need to be $23,800. Assume further that the Camry's total unit cost for the upcoming model year is estimated to be $20,000 and that Toyota requires a 20% profit margin on selling price (which is equivalent to a 25% markup on total cost). a. What price will Toyota establish for the Camry for the upcoming model year? $ b. Since the estimated manufacturing cost the target cost, Toyota its total costs to maintain competitive pricing within its profit objectives. Laredo Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,180. The freight and installation costs for the equipment are $600. If purchased, annual repairs and maintenance are estimated to be $410 per year over the four-year useful life of the equipment. Alternatively, Laredo Corporation can lease the equipment from a domestic supplier for $1,380 per year for four years, with no additional costs. Prepare a differential analysis dated March 15 to determine whether Laredo Corporation should lease (Alternative 1) or purchase (Alternative 2) the equipment. (Hint: This is a "lease or buy" decision, which must be analyzed from the perspective of the equipment user, as opposed to the equipment owner.) If an amount is zero, enter "0". Differential Analysis Lease (Alt. 1) or Buy (Alt. 2) Equipment March 15 Lease Equipment Buy Equipment Differential Effects Costs: Purchase price Freight and installation Repair and maintenance (4 years) Lease (4 years) Total costs (Alternative 1) (Alternative 2) (Alternative 2) Determine whether Laredo should lease (Alternative 1) or buy (Alternative 2) the equipment