Castillo Petroleum has spent $205,000 to refine 63,000 gallons of petroleum distillate, which can be sold for $6.20 per gallon. Alternatively, Castillo can process the distillate further and produce 54,000 gallons of cleaner fluid. The additional processing will cost $1.75 per gallon of distillate. The cleaner fluid can be sold for $9.30 pem galion. To sell cleaner fuld, Castillo must pay a sales commission of $0.12 per gallon and a transportation charge of $0.19 per gallon Read the requirements Turner Turther The Requirement 2. Identify the sunk cost. Is the sunk cost relevant to Castillo's decision? V is a sunk cost that differ between the alternatives of selling as is or processing further. Consequently this sunk cost is to the sell-or-process further decision. Requirement 3. Should Castillo sell the petroleum distillate or process it into cleaner fluid? Show the expected net revenue difference between the two alternatives. (For the difference in total net revenue, use a parenthotos or a minus sign it processing further will decrease total net revenue.) Process Sell Asis Further Difference Expected revenue from selling 63,000 gallons of petroleum distilate Expected revenue from selling 54,000 gallons of cleaner fluid Additional costs of processing Total net revenue Decision Enter any number in the edit fields and then continue to the next question. ment $205,000 to refine 63,000 gallons of petroleum distillate, which can be sold for $6.20 per gallon. Alternatively, Castillo jce 54,000 gallons of cleaner fluid. The additional processing will cost $1.75 per gallon of distillate. The cleaner fluid can b d. Castillo must pay a sales commission of $0.12 per galon and a transportation charge of $0.19 per gallon. .. diagram for Castillo's alternatives - X Requirements 1. Fill in the diagram for Castillo's alternatives. 2. Identify the sunk cost. Is the sunk cost relevant to Castillo's decision? 3. Should Castillo sell the petroleum distillate or process it into cleaner fluid? Show the expected net revenue difference between the two alternatives. Print Done y the sunk cost. Is the sunk cost relevant to Castillo's decision? Castillo Petroleum has spent $205,000 to refine 63,000 gallons of petroleum distillate, which can be sold for $6.20 per gallon. Alternatively, Casullo can proceso e Sistillate further and produce 54,000 gallons of cleaner fluid. The additional processing will cost $1.75 per gallon of distillate. The cleaner fluid can be sold for $9.30 per Ballon. To sell cleaner fluid. Castillo must pay a sales commission of $0.12 per gallon and a transportation charge of $0.19 per gallon. Read the requirements Requirement 1. Fill in the diagram for Castillo's alternatives. Revenues from selling as is Joint costo of producing 63,000 gallons of potrolom distillate Cost of processing further Revenues from processing further Requirement 2. Identify the sunk cost, is the sunk cost relevant to Castillo's decision? The is a sunk cost that differ between the alternatives of selling as is or processing further. Consequently Enter any number in the edit fields and then continue to the next