{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

15-11 - 15-11 15-23(continued(2 The solution to Requirement...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
15-11 15-23 (continued) (2) The solution to Requirement 1 shows that $1,500 more profit will be earned by further processing when the selling price of shampoo/ conditioner is $16 per unit and sales will be 3,000 units. However, if the selling price of shampoo/conditioner is only $15 per unit instead of $16, profit from further processing will be $3,000 less because of the reduction in sales revenue [($16 - $15) x 3,000 units]. In this case, further processing will now reduce profit made by selling shampoo by $1,500. Thus, shampoo should not be processed further into shampoo/conditioner if the selling price of shampoo/conditioner is only $15. Of course, if the company reduces the selling price, it may be able to sell more than 3,000 bottles of shampoo/conditioner which would affect the profit. So, the decision of whether to sell or process
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Ask a homework question - tutors are online