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Wright Company produces products I, J, and K from a single raw material input. Budgeted data for the next month is as follows: Product I
Wright Company produces products I, J, and K from a single raw material input. Budgeted data for the next month is as follows: |
Product I | Product J | Product K | |
Units produced | 2,500 | 3,000 | 4,000 |
Per unit sales value at split-off | $20 | $25 | $25 |
Added processing costs per unit | $4 | $6 | $6 |
Per unit sales value if processed further | $28 | $28 | $33 |
If the cost of the raw material input is $88,000, which of the products should be processed beyond the split-off point? |
Product I | Product J | Product K | |
A) | yes | yes | no |
B) | yes | no | yes |
C) | no | yes | no |
D) | no | yes | yes |
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