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

question 56

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 $15,000.
-How much is the ending inventory reduction for the byproduct if byproducts are recognized in the general ledger at NRV during production?

• A) $0
• B) $1,500
• C) $14,375
• D) $16,000
• E) $17,500

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Definitions:

Time Inconsistency

A situation where a decision-maker's preferences change over time, often leading to a conflict between long-term goals and short-term gratification.

Package Sizes

The dimensions or amount of product contained within a package, affecting consumer choices and inventory management.

Framing Effects

The influence on decision making prompted by the way information is presented, rather than just the information itself.

Self-Serving Bias

The common human tendency to attribute positive events to one's own character but attribute negative events to external factors.