Sheffield Corp. produces several products that can be sold at the split-off point or processed further and then sold. The following results are from a recent period:ProductSales Valueat Split-offAdditionalVariable CostsSales Value afterFurther ProcessingGreen lumber$158600$21000$166000Rough lumber13000028900181600Sawdust10400022100130000What is the increase in profit if the products which are most profitable if processed further are processed further?$26600$13000$85000$260600

Additional revenue = Sales value after further processing - Sales Value at split off

Answered: Sheffield Corp. produces several…

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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Sheffield Corp. produces several products that can be sold at the split-off point or processed further and then sold. The following results are from a recent period:

Product	Sales Value at Split-off	Additional Variable Costs	Sales Value after Further Processing
Green lumber	$158600	$21000	$166000
Rough lumber	130000	28900	181600
Sawdust	104000	22100	130000

What is the increase in profit if the products which are most profitable if processed further are processed further?

$26600

$13000

$85000

$260600

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