1) Conviser Tools manufactures a number of products from the same raw material. Joint processing costs total $10,000. Product A could be sold at the cut-off point for $18,000 or it can be further processed at a cost of $9,000 and then sold for $35,000. Conviser should:

A) Further process product A because its incremental revenues will exceed incremental costs by $16,000.

B) Further process product A because its incremental revenues will exceed incremental costs by $8,000.

C) Further process product A because its incremental revenues will exceed incremental costs by $26,000.

D) Sell as-is because the incremental loss is $2,000 if processed further.

2) Which of the following items do not require cash outflow?

A) Salaries

B) Purchase of raw materials

C) Depreciation

D) Advertising