LanaTech Produces Three Products, X, Y, and Z, from Recycled

question 61

Short Answer

LanaTech produces three products, X, Y, and Z, from recycled paper. Budgeted data for next month follows: $$\begin{array} { l r r r } & \underline { \mathbf { X } } & \underline { \mathbf { Y } } & \underline { \mathbf { Z } } \\\text { Units produced } & 800 & 2,400 & 1,600 \\\hline \text { Sales value at split-off per unit } & \$ 6 & \$ 15 & \$ 12 \\\text { Additional processing costs per unit } & \$ 1 & \$ 4 & \$ 5 \\\text { Joint production costs per unit } & \$ 2 & \$ 6 & \$ 4 \\\text { Sales value if processed further per unit } & \$ 9 & \$ 20 & \$ 16\end{array}$$ The joint cost of the recycled paper is $110,000. Which of the products should be produced beyond the split-off point? $\begin{array}{llll}&X&Y&Z\\\text { A. } & \text { No } & \text { Yes } & \text { Yes } \\\text { B. } & \text { Yes } & \text { Yes } & \text { No } \\\text { C. } & \text { No } & \text { No } & \text { No } \\\text { D. } & \text { No } & \text { Yes } & \text { No }\end{array}$

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Definitions:

Electroconvulsive Therapy (ECT)

A medical treatment most commonly used for major depressive disorder and bipolar disorder, involving electric currents passed through the brain to induce seizures.

Biomedical Treatment

Medical approaches to treating psychological disorders by focusing on the biological or physical aspects, such as medication.

Cortical Seizure

A seizure originating in the cerebral cortex of the brain, potentially affecting motor skills, consciousness, or sensory perception.

Placebo Effect

The beneficial effect on a patient's health that arises from the patient's expectations rather than from the actual treatment.