Meehan Gifts Manufactures a Number of Products from the Same

Multiple Choice

Meehan Gifts manufactures a number of products from the same raw material.Joint processing costs total $4,000.Product Z could be sold at the cut-off point for $6,000 or it can be further processed at a cost of $9,000 and then sold for $14,000.Meehan Company should

A) sell product Z at the split-off point because its incremental costs will exceed incremental revenues by $5,000 than if processed further.
B) further process product Z because its incremental revenues will exceed incremental costs by $1,000 with this option.
C) sell product Z at the split-off point because its incremental costs will exceed incremental revenues by $1,000 than if processed further.