Figure 6-7
Suppose That a Concrete Manufacturer Produces Four Grades

Multiple Choice

Figure 6-7
Suppose that a concrete manufacturer produces four grades of concrete totaling 500,000 cubic yards as follows at a joint cost of £2,000,000: $$\begin{array} { c c c } \text { Grade } & \text { Cubic Yards } & \text { Sales Value } \\\text { A } & 75,000 & £ 375,000 \\\text { B } & 200,000 & 1,200,000 \\\text { C } & 100,000 & 700,000 \\\text { D } & 125,000 & 850,000\end{array}$$
-Refer to Figure 6-7. What is the gross profit of Grade D if the constant gross margin percentage method is used?

A) £306,000
B) £1,125,000
C) £544,000
D) £900,000