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Chino Company manufactures fabric and clothing Managers can either sell the unfinished fabric to other clothing manufacturers or incur additional conversion costs to create a

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Chino Company manufactures fabric and clothing Managers can either sell the unfinished fabric to other clothing manufacturers or incur additional conversion costs to create a finished garment. The costs incurred to produce the unfinished fabric are $400,000 which are allocated to the products based on the sales value of the unfinished fabric. Following is information concerning the clothing that can be produced from the fabric Number of Selling Price of Selling Price after Additional Product Units Unfinished Fabric Processing further Processing Cost Pants 6,00 $20.00 $30.00 $28,50 Shirts 12,000 23.20 32.40 64,000 Coats 4,000 35.10 43.2 18.300 Required: 2-0. Calculate the increase or decrease in profit if the products are processed further (Enter all values as positive values.) Profit Pants Shirts Coats 2.b. Which products should be sold as unfinished fabric and which should be further processed Action (Pants Shirts Couti 3. Assume that the $400.000 costs is located based on the number of units of output which products should be sold as unfinished fabric and which should be further processed? Pro Cea

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