![jnelso5437](/avatars/40442.jpg)
jnelso5437
28.07.2020 •
Business
Port Allen Chemical Company processes raw material D into joint products E and F. Raw material D costs $4 per liter. It costs $100 to convert 100 liters of D into 60 liters of E and 40 liters of F. Product F can be sold immediately for $4 per liter or processed further into Product G at an additional cost of $3 per liter. Product G can then be sold for $9 per liter.
a. Determine whether Product F should be sold or processed further into Product G.
b. Calculate the net advantage (disadvantage) of further processing.
c. Use a negative sign with your answer to indicate a net disadvantage (if applicable).
Solved
Show answers
More tips
- A Art and Culture Attention, the Final Episode of Margo is Almost Here!...
- W Work and Career How to Start Your Own Business: Tips and Recommendations...
- S Society and Politics 10 Tips for Boosting Your Self-Esteem...
- C Computers and Internet How to Create a Folder on Your iPhone?...
- G Goods and services How to sew a ribbon: Tips for beginners...
- F Food and Cooking How to Make Mayonnaise at Home? Secrets of Homemade Mayonnaise...
- C Computers and Internet Which Phone is Best for Internet Surfing?...
- F Food and Cooking Everything You Need to Know About Pasta...
- C Computers and Internet How to Choose a Monitor?...
- H Horoscopes, Magic, Divination Where Did Tarot Cards Come From?...
Answers on questions: Business
- B Business What is the main advantage of diversification as an investment policy? O It offsets the effects of inflation on investments. O It reduces risk to investors. O It guarantees a fixed...
- B Business What are 2 characteristics for intellectual property rights? (in entrepreneurship)...
- B Business Nearly 84% of persons who experienced force or threat of force in 2008 felt that the police acted improperly...
- B Business Jonathan recently sold his home and was able to take home $423,000 after paying the real estate broker s commission of 6%. If the buyer was ultimately found through a buyer broker,...
- B Business For the statements below select the appropriate terms from the given choices. (1) A revenue not yet recognized; collected in advance. (2) Office supplies on hand that will be used...
- B Business Franken Company, a ski tuning and repair shop, opened on November 1, 2016. The company carefully kept track of all its cash receipts and cash payments. The following information...
- B Business Indicate which of the five COSO internal control components is best represented by each internal control. 1. The company�s computer systems track individual transactions and automatically...
- B Business In the statement of stockholders equity, Retained Earnings had a beginning balance of $25,000. During the period the company reports a net income of $10,000 and a dividend of $4,000....
- M Mathematics Please help thank you...
- S SAT Which of the following is not a main purpose of expository text....
Ответ:
a) Product G should be produced and sold
b) Net financial advantage $80
Explanation:
A company should process further a product if the additional revenue from the split-off point is greater than than the further processing cost.
Also note that all cost incurred up to the split-off point are irrelevant to the decision to process further .
$
Revenue after split-off point
($9× 40 litres) 360
Revenue at the slit of point
($4 × 40) (160)
Additional income from further processing 200
Further processing cost ($3× 40) (120)
Incremental income from further processing 80
Incremental income from further processing = $80
a) The product F should be processed further and sold as product G. Doing so would increase the net income by $80.
b) Net advantage $80
Ответ: