Davidian Company Uses a Joint Process to Produce Products W

Multiple Choice

Davidian Company uses a joint process to produce products W, X, Y, and Z. Each product may be sold at its split-off point or processed further. Additional processing costs of specific products are entirely variable. Joint processing costs for a single batch of joint products are $120,000. Other relevant data are as follows: Processing Y further will cause profits to

A) increase by $68,000.
B) increase by $52,000.
C) decrease by $32,000.
D) increase by $120,000.