Question
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 1,900 2,400 3,400 Per unit sales value at split-off $ 14 $ 18 $ 19 Added processing costs per unit $ 4 $ 6 $ 6 Per unit sales value if processed further $ 23 $ 23 $ 28
If the cost of raw material input is $82,000, 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 D
Option A
Option B
Option C
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