Exercise 23-8 sell or process further lo a1 cobe company has already manufactured 15,000 units of product a at a cost of $30 per unit. the 15,000 units can be sold at this stage for $450,000. alternatively, the units can be further processed at a $210,000 total additional cost and be converted into 5,800 units of product b and 11,900 units of product c. per unit selling price for product b is $107 and for product c is $55. 1. prepare an analysis that shows whether the 15,000 units of product a should be processed further or not.

Yes

Explanation:

In this question, we have to compare the cost so that the net income or net loss would be calculated.

                                         Sales              Process Further Cost

Sales                                $450,000       $1,275,100

Less: Processing cost                            $210,000

Net income                    $450,000        $1,065,100

where,

Sales of further processing cost would be

= 5,800 units × $107 + 11,900 units × $55

= $620,600 + $654,500

= $1,275,100

Since, net income is increased by $615,100. So, It would be process further

answer; i believe its (d) intrinsic;