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Gary Corporation produces products X, Y, and Z from a single raw material input. Budgeted data for the next month is as follows: Product X

Gary Corporation produces products X, Y, and Z from a single raw material input. Budgeted data for the next month is as follows:

Product X Product Y Product Z
Units produced 2,200 2,700 3,700
Per unit sales value at split-off $20 $26 $22
Added processing costs per unit $5 $7 $7
Per unit sales value if processed further $28 $28 $33

If the cost of the raw material input is $75,000, which of the products should be processed beyond the split-off point?

Product X Product Y Product Z
A) yes yes no
B) yes no yes
C) no yes no
D) no yes yes

Option B

Option C

Option D

Option A

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