Sell or Process Further Turner Manufacturing Company makes a partially completed assembly unit that it sells for $50 per unit. Normally, 35,000 units are sold each year. Variable unit cost data on the assembly are as follows: Direct material Direct labor Variable manufacturing overhead $12 7 9 The company is now using only 75% of its normal capacity; it could fully use its normal capacity by processing the assembly further and selling it for $58 per unit. If the company does this, material and labor costs will each increase by $2 per unit and variable overhead will go up by $1 per unit. Fixed costs will increase from the current level of $125,000 to $165,000. Prepare an analysis showing whether Turner should process the assemblies further. Use a negative sign with answer to only indicate a loss from processing assemblies further; otherwise do not use negative signs with your answers. Sell of Process Further Differential Analysis Differential revenue Differential costs Direct material $ Direct labor Variable overhead Fixed costs Additional income (loss) from processing further $ Check Differential Analysis In each of four independent cases, the amount of differential revenue or differential cost is as follows (parentheses indicate decreases): 2 3 Increases (decreases) in: Revenue Costs 1 4 $36,000 $0 ? ? ?? $(20,000) $0 For each case, determine the missing amount that would be necessary for the net differential amount to be: a. $22,000 Use a negative signs with answers to reflect decreases. Increases (decreases) in: 1 2 3 4 Revenue Costs $36,000 $0 $ $ $ $(20,000) $0 b. ($9,000) Use a negative signs with answers to reflect decreases. Increases (decreases) in: 1 2 3 4 Revenue Costs Check $ $36,000 $ $0 $ $(20,000) $ $0 Sandhill Ltd. Has the following quantity discount policy with its supplier Evanora Inc. Quantity Price per Case 1-299 cases $27.00 300-749 cases $25.53 750-1,499 cases 1,500 + cases $24.44 $23.15 The economic order quantity is 173 cases and the annual usage is 41,901 cases. The ordering cost (K) is $5 per order and the carrying cost of inventory (H) is $14 per unit. Determine the most cost-effective order quantity. (Round answers to 2 decimal places, e.g. 125.74.) Most cost effective order quantity Total Cost