wel yiald a total of 65,000 gallons of lacquer thinner that can be sold for $9. to a gation. The 2. Should Casidio sol tha acedone as is or process it into laccpor thrreer? 3how the adestional processing will cost 50.60 per gation of lacquer thinner, To sell the lacoguet thinner, Castlla Clyarical must pay shipping of 50.19 a galion and atministrative expenses of 50.13 a gallon on the thinher Requirement 1. Identity the surk cost ta the sunk cost reievant to Casillos decision? Why or why not? Castillo Chemical has spent $242,000 to refine 74,000 gallons of acetone, which can be sold for \$1.90 a gallon. Alternatively, Castillo Chemical can process the acetone further. This processing will yield a total of 65,000 gallons of lacquer thinner that can be sold for $3.10 a gallon. The additional processing will cost $0.60 per gallon of lacquer thinner. To sell the lacquer thinner, Castillo Chemical must pay shipping of $0.19 a gallon and administrative expenses of $0.13 a gallon on the thinner. Requirements 1. Identify the sunk cost. Is the sunk cost relevant to Castillo's decision? Why or why not? 2. Should Castillo sell the acetone as is or process it into lacquer thinner? Show the expected net revenue difference between the two alternatives