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Che/Jost Company are sheep shearers and are raising tons of sheep on their farm. When they shear the sheep, they can either sell this raw
Che/Jost Company are sheep shearers and are raising tons of sheep on their farm. When they shear the sheep, they can either sell this raw wool to sweater manufacturers as-is or they can spin this raw wool into superfine wool. Che/Jost is trying to decide if they should just sell the raw wool or process it further into superfine wool. 1. The selling price of raw wool II. The variable cost of processing raw wool spun into superfine wool III. The avoidable fixed costs of processing raw wool into superfine wool. IV. The selling price of superfine wool. V. The joint cost of the process from which raw wool is produced. Which of the above items are relevant in a decision of whether to sell the raw wool as-is or process it into superfine wool? II, III, and V. I, II, III, and V. I, II, and IV. I, II, III, and IV
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