Carmen Co Can Further Process Product J to Produce Product D

question 142

Multiple Choice

Carmen Co. can further process Product J to produce Product D. Product J is currently selling for $20 per pound and costs $15.75 per pound to produce. Product D would sell for $38 per pound and would require an additional cost of $8.55 per pound to produce.
What is the differential revenue of producing Product D?

• A) $6.75 per pound
• B) $22.25 per pound
• C) $18.00 per pound
• D) $6.25 per pound

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