A company manufactures product and substance "foop" is considered as waste. New research shows that the said substance can be further process to become a healthy juice drink. The following costs are consideredCost of disposal is 20 per literAdditional processing cost is 6 per literSelling price for the healthy juice drink is 14 per literJoint cost allocated to the 10,000 liters of the substance is P250,000.If the substance is decided to be disposed than processed further, what is the total incremental cost?If the substance is decided to be processed further, what is the incremental benefit (cost)?

Incremental Cost for disposing off means the extra cost to be incurred if product is to be disposed…

Answered: If the substance is decided to be…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company manufactures product and substance "foop" is considered as waste. New research shows that the said substance can be further process to become a healthy juice drink. The following costs are considered

Cost of disposal is 20 per liter
Additional processing cost is 6 per liter
Selling price for the healthy juice drink is 14 per liter
Joint cost allocated to the 10,000 liters of the substance is P250,000.

If the substance is decided to be disposed than processed further, what is the total incremental cost?

If the substance is decided to be processed further, what is the incremental benefit (cost)?

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