Zing Coffee Company produces Columbian coffee in batches of 5,900 pounds. The standard quantity of materials required in the process is 5,900 pounds, which cost $5.00 per pound. Columbian coffee can be sold without further processing for $7.40 per pound. Columbian coffee can also be processed further to yield Decaf Columbian, which can be sold for $12.00 per pound. The processing into Decaf Columbian requires additional processing costs of $12,450 per batch. The additional processing will also cause a 6% loss of product due to evaporation.

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a. Prepare a differential analysis report for the decision to sell or process further.

Zing Coffee Company Proposal to Process Columbian Coffee Further Differential Analysis Report

Differential revenue from further processing per batch:
Additional cost of producing Decaf ColumbianDecaf Columbian per batchDifferential revenueRevenue from sale of Decaf ColumbianRevenue from sale of Decaf Columbian	$Revenue from sale of Decaf Columbian
Additional cost of producing Decaf ColumbianDecaf Columbian per batchDifferential revenueRevenue from sale of Columbian coffeeRevenue from sale of Columbian coffee	Revenue from sale of Columbian coffee
Differential revenueDifferential expenseDifferential revenue		$Differential revenue
Differential cost per batch:
Additional cost of producing Decaf ColumbianDecaf Columbian per batchDifferential revenueRevenue from sale of Columbian coffeeRevenue from sale of Decaf ColumbianAdditional cost of producing Decaf Columbian		Additional cost of producing Decaf Columbian
Differential income from further processing Decaf Columbian per batchDifferential loss from further processing Decaf Columbian per batchDifferential income from further processing Decaf Columbian per batch		$Differential income from further processing Decaf Columbian per batch

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a. Follow Exhibit 10 in the text. For both products, subtract the costs from the revenues. Determine the differential effect on the revenues, costs, and income (loss).

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b. Should Zing Coffee sell Columbian coffee or process further and sell Decaf Columbian?

Yes, process further and sell decaf ColumbianNo, sell Columbian coffeeYes, process further and sell decaf Columbian

c. Determine the price of Decaf Columbian that would cause neither an advantage nor a disadvantage for processing further and selling Decaf Columbian. Round your answer to the nearest cent. $fill in the blank 642247f9f016f85_2 per pound