Emmanuella Petroleum has spent $$204,000$ to refine $62,000$ gallons of petroleum distillate, which can be sold for $$6\mathrm{.}40$ per gallon. Alternatively, Emmanuella Petroleum can process the distillate further and produce $56,000$ gallons of cleaner fluid. The additional processing will cost $$1\mathrm{.}75$ per gallon of distillate. The cleaner fluid can be sold for $$9\mathrm{.}00$ per gallon. To sell cleaner fluid, Emmanuella Petroleum must pay a sales commission of $$0\mathrm{.}13$ per gallon and a transportation charge of $$0\mathrm{.}18$ per gallon.

Read the requirements.

Requirement $2.$ Identify the sunk cost. Is the sunk cost relevant to Emmanuella Petroleum's decision?

The $$ is a sunk cost that $$ 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 Emmanuella Petroleum 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 parentheses or a minus sign if processing further will decrease total net revenue.$)$

Process

Expected revenue from selling $62,000$ gallons of petroleum distillate

Expected revenue from selling $56,000$ gallons of cleaner fluid

Additional costs of processing

Total net revenue

$\backslash$table$[[$Sell As is$,$Process$],[$Further Difference,$]]$

Decision: $$