Rouse Chemical has spent $239,000 to refine 72,000 gallons of acetone, which can be sold for $2.30 a gallon. Alternatively, Rouse Chemical can process the acetone further. This processing will yield a total of 63,000 gallons of lacquer thinner that can be sold for $3.40 a gallon. The additional processing will cost $0.75 per gallon of lacquer thinner. To sell the lacquer thinner, Rouse Chemical must pay shipping of $0.22 a gallon and administrative expenses of $0.14 a gallon on the thinner. Requirements 1. Identify the sunk cost. Is the sunk cost relevant to Rouse's decision? Why or why not? 2. Should Rouse sell the acetone as is or process it into lacquer thinner? Show the expected net revenue difference between the two alternatives. Requirement 1. Identify the sunk cost. Is the sunk cost relevant to Rouse's decision? Why or why not? is a sunk cost that The differ between alternatives of selling as is or processing further. Consequently, this sunk cost of $ is to the sell or process further decision. Requirement 1. Identify the sunk cost. Is the sunk cost relevant to Rouse's decision? Why or why not? is a sunk cost V that The differ between alternatives of selling as is or processing to the sell or process further decision. furthe IS amount spent to refine the acetone cost of further processing Rouse Chemical has spent $239,000 to refine 72,000 gallons of acetone, which can be sold for $2.30 a gallon. Alternatively, Rouse Chemical can process the acetone further. This processing will yield a total of 63,000 gallons of lacquer thinner that can be sold for $3.40 a gallon. The additional processing will cost $0.75 per gallon of lacquer thinner. To sell the lacquer thinner, Rouse Chemical must pay shipping of $0.22 a gallon and administrative expenses of $0.14 a gallon on the thinner. Requirements 1. Identify the sunk cost. Is the sunk cost relevant to Rouse's decision? Why or why not? 2. Should Rouse sell the acetone as is or process it into lacquer thinner? Show the expected net revenue difference between the two alternatives Requirement 1. Identify the sunk cost. Is the sunk cost relevant to Rouse's decision? Why or why not? is a sunk cost that The differ between alternatives of selling as is or processing further. Consequently, this sunk cost of $ IS to the sell or process further decision. irrelevant relevant