Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Differential Analysis Report for Further Processing The management of Dorsch Aluminum Co. is considering whether to process aluminum ingot further into rolled aluminum. Rolled aluminum

image text in transcribed

Differential Analysis Report for Further Processing The management of Dorsch Aluminum Co. is considering whether to process aluminum ingot further into rolled aluminum. Rolled aluminum can be sold for $4,120 per ton, and ingot can be sold without further processing for $2,307.2 per ton. Ingot is produced in batches of 110 tons by smelting 275 tons of bauxite, which costs $576.8 per ton. Rolled aluminum will require additional processing costs of $865.2 per ton of ingot, and 1.2 tons of ingot will produce 1 ton of rolled aluminum (due to trim losses). Required: 1. Prepare a report presenting a differential analysis associated with the further processing of aluminum ingot to produce rolled aluminum. Dorsch Aluminum Co. Proposal to Process Raw Sugar Further 377,666.67 X 253,792 Differential revenue from further processing per batch: Revenue from sale of rolled aluminum Revenue from sale of aluminum ingot Differential revenue Differential cost per batch: Additional cost of processing rolled aluminum 123,874.67 x 95,172 Differential gain from further processing aluminum ingot, per batch 28,702.67

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Sound Investing, Chapter 17 - Off-Balance-Sheet Shams

Authors: Kate Mooney

1st Edition

0071719393, 9780071719391

More Books

Students also viewed these Accounting questions