Sulley Chemical has spent $247,000 to refine 70,000 L of acetone, which can be sold for $1.90/L. Alternatively, Sulley Chemical can process the acetone further to yield a total of 62,000 L of lacquer thinner that can be sold for $3.90/L. The additional processing will cost $0.75/L of lacquer thinner. To sell the lacquer thinner, Sulley Chemical must pay shipping of $0.18/L and administrative expenses of $0.15/L on the thinner. Requirements 1. Fill in the diagram for Sulley's decision. 2. Identify the sunk cost. Is the sunk cost relevant to Sulley's decision? Why or why not? Should Sulley sell the acetone or process it into lacquer thinner? Show the expected net revenue difference between the two alternatives. Requirement 1. Fill in the diagram for Sulley's decision. Sell As Is Acetone sales revenue Sunk cost of producing 70,000 L of acetone Process Cost of further processing Further Lacquer thinner sales revenue Requirement 2. Identify the sunk cost. Is the sunk cost relevant to Sulley's decision? Why or why not? The $ is a sunk cost that between the alternatives of selling as is or processing further. Consequently, this sunk cost is to the sell-or-process-further decision