Ask Question
7 September, 04:49

Listmann Corp. processes four different products that can either be sold as is or processed further. Listed below are sales and additional cost dа ta:

Product Sales Value without Processing Additional Costs Sales Value after processing

Premier $1,350 $900 $2,700

Deluxe 450 225 630

Super 900 450 1,800

Basic 90 45 180

Which product (s) should not be processed further?

+4
Answers (1)
  1. 7 September, 07:52
    0
    The product Deluxe sgould not be processed further.

    Explanation:

    Giving the following information:

    Sales - Value without Processing - Additional Costs - Sales Value after processing

    Premier: $1,350 - $900 - $2,700

    Deluxe: 450 - 225 - 630

    Super: 900 - 450 - 1,800

    Basic: 90 - 45 - 180

    We need to calculate the contribution margin of each product before and after processing.

    Premier:

    Before = 1,350

    After = 2,700 - 900 = $1,800

    It is more profitable to continue processing.

    Deluxe:

    Before = 450

    After = 630 - 225 = $405

    It is more profitable to sell before processing.

    Super:

    Before = 900

    After = 1,800 - 450 = $1,350

    It is more profitable to continue processing.

    Basic:

    Before = 90

    After = 180 - 45 = 135

    It is more profitable to continue processing.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Listmann Corp. processes four different products that can either be sold as is or processed further. Listed below are sales and additional ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers