The Scottie Sweater Company produces sweaters under the "Scottie" label. The company buys raw woof and processes it into wool ram from which the sweaters are woven. One spindle of wool yarn is required to produce one sweater. The costs and revenues issociated with the sweaters are piven below: Originally, all of the wool yam was used to produce sweaters, but in recent years a market has developed for the wool yam itself. The yatn is purchased by other companies for use in production of wool blankets and other wool products. Since the development of the market for the wool yarn, a continuing dispute has existed in the Scotte Sweater Company as to whether the yarn should be sold simply as yam or processied into sweaters. Current cost and revenue data on the yarn are given below: The market for sweaters is temporarly depressed, due to unusually warn weathet in the western states where the sweaters are sold. This hos made it necessary for the company to discount the selling price of the sweaters to $33.00 from the normal $43.00 price. Since the market for wool yarn has remained strong. the dispute has again surfaced over whether the yam should be sold outright rather than processed into sweaters. The sales manager thinks that the production of sweaters should be discontinued; she is upset about having to seli sweaters at a $450 loss when the yarn could be soid for a $4.00 profit. However, the production superintendent does not want to ciose down a large portion of the factory. He argues that the company is in the sweater business. not the yarn business, and the company should focus on its core strength. All of the manutacturing overheod costs are foxed and would not be affected even if sweaters were discontinued. Manufacturing overhead is assigned to products on the basis of 150% of direct labor cost. Materials and direct labor costs are variable Required: 1. What is the financial advantage (disadvantape) of further processing one spindle of wool yam into a sweater? 2. Would you recormend that the wool yam be sold outright or processed into sweaters? 3. What is the lowest price that the company should accept for a sweater? The market for sweaters is temporarily depressed, due to unusually warm weather in the western states where the sweaters are sold. This has made it necessary for the company to discount the selling price of the sweaters to $33.00 from the normal $43.00 price: Since the market for wool yam has remained strong. the dispute has again surfaced over whether the yarn should be sold outright rather than processed into sweaters. The sales manager thinks that the production of sweaters should be discontinued, she is upset about having to sell sweaters at a $4.50 loss when the yarn could be sold for a $4.00 profit. However, the production superintendent does not want to close down a large portion of the factory. He argues that the compary is in the sweater business, not the yarn business, and the company should focus on its core strength. All of the manufacturing overhead costs are fixed and would not be affected even if sweaters were discontinued. Manufacturing overhead is assigned to products on the basis of 150% of direct labor cost. Materials and direct labor costs are variable Required: 1. What is the financial advantage (disadvantage) of further processing one spindle of wool yarn into a sweater? 2. Would you recommend that the wool yarn be sold outright or processed into sweaters? 3. What is the lowest price that the company should accept for a sweater? Complete this question by entering your answers in the tabs below. What is the financial advantage (disadvantage) of further processing one spindle of wool yarn into a sweater? (Round your answerito 2 decimal piaces.) The market for sweaters is temporarily depressed, due to unusually warm weather in the western states where the sweaters are sold. This has made it necessary for the company to discount the selling price of the sweaters to $33.00 from the normal $43.00 price. Since the market for wool yam has remained strong, the dispute has again surfaced over whether the yarn should be sold outright rather than processed into sweaters. The sales manager thinks that the production of sweaters should be discontinued, she is upset about having to sell sweaters at a $4.50 loss when the yarn could be sold for a $4.00 profit. However, the production superintendent does not want to close down a large portion of the factory. He argues that the company is in the sweater business, not the yarn business, and the company should focus on its core strength. All of the manufacturing overhead costs are fixed and would not be affected even if sweaters were discontinued. Manufacturing overhead is assigned to products on the basis of 150% of direct labor cost Materials and direct labor costs are variable. Required: 1. What is the financial advantage (disadvantage) of further processing one spindle of wool yarn into a sweater? 2 Would you recommend that the wool yarn be sold outright or processed into sweaters? 3. What is the lowest price that the company should accept for a sweater? Complete thi - question by entering your answers in the tabs below. Would you recornmend that the wool yarn be sold outright or processed Into sweaters? The market for sweaters is temporarily depressed, due to unusually warm weather in the western states where the sweaters are sold. This has made it necessary for the company to discount the selling price of the sweaters to $33.00 from the normal $43.00 price. Since the market for wool yarn has remained strong, the dispute has again surfaced over whether the yarn should be sold outright rather than processed into sweaters. The sales manager thinks that the production of sweaters should be discontinued; she is upset about having to sell sweaters at a $4,50 loss when the yarn could be sold for a $4.00 profit. However, the production superintendent does not want to close down a large portion of the factory. He argues that the company is in the sweater business, not the yam business, and the company should focus on its core strength. All of the manufacturing overhead costs are fixed and would not be affected even if 5 weaters were discontinued Manufacturing overhead is assigned to products on the basis of 150% of direct labor cost. Materials and direct labor costs are variable. Required: 1. What is the financial advantage (disadvantage) of further processing one spindle of wool yam into a sweater? 2 Would you recommend that the wool yarn be sold outright or processisd into sweaters? 3. What is the lowest price that the company should accept for a sweater? Complete this question by entering your answers in the tabs below. What is the lowest price that the company should accept for a sweater? (Round your answer to 2 decimal placess)