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Wright Company produces products I, J, and K from a single raw material input. Budgeted data for the next month follows: Product I Product J
Wright Company produces products I, J, and K from a single raw material input. Budgeted data for the next month follows: |
Product I | Product J | Product K | |
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 I | Product J | Product K | |
A) | yes | yes | no |
B) | yes | no | yes |
C) | no | yes | no |
D) | no | yes | yes |
Option B
Option D
Option C
Option A
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