(Solved):Chudrick Inc. makes unfinished bookcases that it sells for $59.05. Production costs are $38.04…

 

Question

Chudrick Inc. makes unfinished bookcases that it sells for $59.05. Production costs are $38.04 variable and $9.88 fixed. Because it has unused capacity, Chudrick is considering finishing the bookcases and selling them for $74.32. Variable finishing costs are expected to be $8.72 per unit with no increase in fixed costs. Prepare an analysis on a per unit basis showing whether Chudrick should sell unfinished or finished bookcases.

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