The Carter Corporation Makes Products a and B in a Joint

question 162

Multiple Choice

The Carter Corporation makes products A and B in a joint process from a single input, R. During a typical production run, 50,000 units of R yield 20,000 units of A and 30,000 units of B at the split-off point. Joint production costs total $90,000 per production run. The unit selling price for A is $4.00 and for B is $3.80 at the split-off point. However, B can be processed further at a total cost of $60,000 and then sold for $7.00 per unit.In a decision between selling B at the split-off point or processing B further, which of the following items is not relevant:

• A) the $60,000 cost to process B beyond the split-off point.
• B) the $3.80 unit sales price of B at the split-off point.
• C) the portion of the $90,000 joint production cost allocated to B.
• D) the $7 unit selling price for B after further processing.

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Definitions:

Critical Thinker

An individual who possesses a strong ability to engage in reflective and independent thinking, in order to make reasoned and well-thought judgments.

Wartime Detainees

Individuals who are held or imprisoned during times of war or conflict, often without trial, due to their nationality, suspected activities, or affiliation.

Circular

Describing reasoning or argument that is logically flawed because its conclusion is assumed in its premises.