Question
Dundee Company currently produces three products from a joint process. The joint process has total costs of $290,000 per month. All three products, A, B
Dundee Company currently produces three products from a joint process. The joint process has total costs of $290,000 per month. All three products, A, B & C, are immediately saleable as they come out of the joint process. Alternatively, any of the products could continue on with additional processing and be sold as a more complete product. The following information is available:
Units | Immediate Sales Price | Later Sales Price | Unit Cost of Further Processing | |||||||||||
A | 32,000 | $ | 9 | $ | 12 | $ | 7 | |||||||
B | 64,000 | $ | 9 | $ | 17 | $ | 7 | |||||||
C | 96,000 | $ | 8 | $ | 12 | $ | 2 | |||||||
Which of the products should be sold after further processing?
Multiple Choice
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Product A only
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Products B and C
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Products A and C
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Product B only
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