Sell or Process Further

Calgary Lumber Company incurs a cost of $$392$ per hundred board feet $(hbf)$ in processing certain "rough$-$cut" lumber, which it sells for $$548$ per hbf$.$ An alternative is to

produce a "finished$-$cut" at a total processing cost of $$526$ per hbf$,$ which can be sold for $$752$ per hbf$.$

a$.$ Prepare a differential analysis dated March $15$ on whether to sell rough$-$cut lumber $($Alternative $1)$ or process further into finished$-$cut lumber $($Alternative $2).$

Differential Analysis

Sell Rough$-$Cut $($Alt$.1)$ or Process Further into Finished$-$Cut $($Alt$.2)$

March $15$

b$.$ Determine whether to sell rough$-$cut lumber $($Alternative $1)$ or process further into finished$-$cut lumber $($Alternative $2).$