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Bancroft Co. can further process Product S to produce Product T. Product S is currently selling for $55 per kilo and costs $48 per kilo
Bancroft Co. can further process Product S to produce Product T. Product S is currently selling for $55 per kilo and costs $48 per kilo to produce. Product T would sell for $89 per kilo and would require an additional cost of $33 per kilo to produce. Bancrofts marketing department says they can sell 50,000 kilos of Product S per year or, alternatively, 42,000 kilos of Product T per year. Calculate the total effect on Net Income per year if product T is produced from product S and sold for $89 per kilo.
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