A Sawmill Bought a Shipment of Logs for $40,000 $\text { Type 1 } \quad \text { Type 2 }$

Multiple Choice

A sawmill bought a shipment of logs for $40,000. When cut, the logs produced a million board feet of lumber in the following grades:
Type 1 - 400,000 bd. ft. priced to sell at $0.12 per bd. ft.
Type 2 - 400,000 bd. ft. priced to sell at $0.06 per bd. ft.
Type 3 - 200,000 bd. ft. priced to sell at $0.04 per bd. ft.
$\text { Type 1 } \quad \text { Type 2 }$
(A) $\$ 16,000 \quad \$ 16,000$
(B) $\$ 13,333 \quad \$ 4,444$
(C) $\$ 40,000 \quad \$ 24,000$
(D) $\$ 24,000 \quad \$ 12,000$
(E) $\$ 24,000 \quad \$ 8,000$
How much cost should be allocated to Type 1 and Type 2, respectively?

A) A Above.
B) B Above.
C) C Above.
D) D Above.
E) E Above.