Question

Listmann Corp. processes four different products that can either be sold as is or processed further. Listed below are sales and additional cost data: Product Sales Value with no further Processing Additional Processing Costs Sales Value after further processing Premier $1,350 $900 $2,700 Deluxe 450 225 630 Super 900 450 1,800 Basic 90 45 180
2. Which product(s) should not be processed further? Premier. Deluxe. Super. Basic. Premier and Basic.

Answer 1

Answer:

Deluxe

Explanation:

The computation is shown below:

= Sales Value after further processing - further processing cost - sales value

For Premier

= $2,700 - $900 -$1,350

= $450

For Deluxe

= $630 - $225 - $430

= -$25

For Super

= $1,800 - $450 - $900

= $450

For Basic

= $180 - $45 - $90

= $45

As we see that out of four different products, the deluxe contains negative value which reflect that this product should not processed further that means other three products should processed further