6

Chalk Corporation produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the split-off point for $58,000, or processed further at a cost of $17,000, and sold for $73,000.

Which of the following statements is true concerning Product Y?

Multiple Choice

• Product Y should be processed further for a financial advantage of $56,000.

• Product Y should be sold at the split-off point.

• Product Y should be processed further for a financial advantage of $15,000.

• Product Y should be processed further for a financial advantage of $73,000.