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Ivanhoe Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it has unused capacity, Ivanhoe is
Ivanhoe Inc. makes unfinished bookcases that it sells for $59. Production costs are $38 variable and $10 fixed. Because it has unused capacity, Ivanhoe is considering finishing the bookcases and selling them for $71. Variable finishing costs are expected to be $9 per unit with no increase in nixed costs. Prepare an analysis on a per-unit basis that shows whether Ivanhoe should sell unfinished or finished bookcases. (If an amount reduces the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).)
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