Use the Information Below to Answer the Following Question(s)

question 34

Multiple Choice

Use the information below to answer the following question(s) .Troy Company processes 15,000 litres of direct materials to produce two products, Product X and Product Y.Product X, a byproduct, sells for $4 per litre, and Product Y, the main product, sells for $50 per litre.The following information is for August:
The manufacturing costs totalled $95,000.
-What is the net effect to the income statement for the sale of byproduct, if byproducts are recognized at the point of sale?

• A)$0
• B)$1,500
• C)$16,000
• D)$17,500
• E)$20,000

---

Definitions:

Stock Market Crash

A rapid and significant decline in the stock market prices, which can lead to a widespread panic among investors and significantly affect the overall economy.

Stock Repurchase

A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares.

Continuing Shareholders

Continuing shareholders are individuals or entities that retain their shares in a company through various corporate actions or transactions, maintaining their stake in the company.

Sold

The act of transferring ownership of an asset or security from a seller to a buyer in exchange for money or equivalent.