Varto Company has $11,200$ units of its product in inventory that it produced last year at a cost of $$158,000.$ This year$$s model is better than last year$$s$,$ and the $11,200$ units cannot be sold at last year$$s normal selling price of $$48$ each. Varto has two alternatives for these units: $(1)$ They can be sold as is to a wholesaler for $$134,400$ or $(2)$ they can be processed further at an additional cost of $$254,200$ and then sold for $$380,800.$Home Properties is developing a subdivision that includes $450$ home lots. The $190$ lots in the Canyon section are below a ridge and do

not have views of the neighboring canyons and hills; the $260$ lots in the Hillop section offer unobstructed views. The expected selling

price for each Canyon lot is $$53,000$ and for each Hilltop lot is $$103,000.$ The developer acquired the land for $$2,100,000$ and spent

another $$2,700,000$ on street and utilities improvements.

Assign the joint land and improvement costs of $$4,800,000$ to the Canyon section and the Hillop section using the value basis of

allocation.

Note: Do not round your intermediate calculations.

$($a$)$ Prepare a sell as is or process further analysis of income effects.

$($b$)$ Should Varto sell the products as is or process further and then sell them?