Drew Cane Products, Inc., processes sugar cane in batches. The company buys a batch of sugar cane from farmers for $90 which is then crushed in the company's plant at a cost of $11. Two intermediate products, cane fiber and cane juice, emerge from the crushing process. The cane fiber can be sold as is for $21 or processed further for $13 to make the end product industrial fiber that is sold for $45. The cane juice can be sold as is for $41 or processed further for $29 to make the end product molasses that is sold for $103. What is the financial advantage (disadvantage) for the company from processing one batch of sugar cane into the end products industrial fiber and molasses rather than not processing that batch at all?
A. ($143)
B. $5
C. ($39)
D. $44
Answer: B
You might also like to view...
On December 1, 2016, Vonn Corporation paid $8,000 rent in advance. The rent per month is $1,000 . If Hazel's accounting period ends on December 31, 2016, what will be reported on the financial statements?
a. Prepaid Rent of $7,000 on its balance sheet at December 31, 2016 b. Prepaid Rent of $8,000 on its balance sheet at December 31, 2016 c. Rent Expense of $8,000 on its 2016 income statement d. Rent Revenue of $7,000 on its 2016 income statement
Auditors can choose to test the client's warranty reserves using primarily tests of controls and substantive analytical procedures
a. True b. False Indicate whether the statement is true or false
In some states, unfair trade practices acts are designed to ________
A) regulate the markups used by various industries B) control the sale of agricultural products and raw materials C) regulate all forms of psychological pricing D) prohibit the selling of products below cost E) ban the use of price lining
A purchase of supplies for cash is recorded in the
A) Revenue journal B) Purchases journal C) Cash Receipts journal D) Cash Payments journal