Author Question: A company manufactures three products, A, B, and C from a single raw material input. Product C can ... (Read 15 times)

danielfitts88 · **on:** Mar 6, 2021

Question 1

What revenue or expense amounts are necessary to make a sell-or-process-further decision and why? What items are irrelevant to the decision and why?

Question 2

A company manufactures three products, A, B, and C from a single raw material input. Product C can be sold at the split-off point for total revenues of $60,000 or it can be processed further at a total cost of $16,000 and then sold for $78,000. Product C
◦ should be sold at the split-off point, rather than processed further.
◦ would increase the company's overall net income by $18,000 if processed further and then sold.
◦ would increase the company's overall net income by $78,000 if processed further and then sold.
◦ would increase the company's overall net income by $2000 if processed further and then sold.

jasonq · **Reply #1 on:** Mar 6, 2021

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