Sell or Process Further Jackson Lumber Company incurs a cost of $390 per hundred board feet (hbf) in processing certain "rough-cut" lumber, which it sells for $550 per hbf. An alternative is to produce a "finished cut" at a total processing cost of $529 per hbf, which can be sold for $766 per hbf. Prepare a differential analysis dated August 9 on whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2). For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Sell Rough-Cut (Alt. 1) or Process Further into Finished Cut (Alt. 2) August 9 Process Differential Sell Further into Effect Rough-Cut Finished Cut on Income (Alternative 1) (Alternative 2) (Alternative 2) Revenues, per 100 board ft. Costs, per 100 board ft. Income (Loss), per 100 board ft. $ Determine whether to sell rough-cut lumber (Alternative 1) or process further into finished-cut lumber (Alternative 2). Internal Rate of Return A project is estimated to cost $152,427 and provide annual net cash flows of $31,000 for six years. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% . 0.943 0.909 0.893 0.870 0.833 N 1.833 1.736 1.690 1.626 1.528 w 2.673 2.487 2.402 2.283 2.106 A 3.465 3.170 3.037 2.855 2.589 0 4.212 3.791 3.605 3.352 2.991 0 4.917 4.355 4.111 3.784 3.326 5.582 4.868 4.564 3.605 4.160 4.487 0 4.968 3.837 6.210 6.802 5.335 5.759 0 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Determine the internal rate of return for this project, using the Present Value of an Annuity of $1 at Compound Interest table shown above