Question

6. Zander Brick Co. produces several products that can be sold at the split-off point or processed further and then sold. The following results are from a recent period:
Sales Value Additional Sales Value after
Product at Split-off Variable Costs Further Processing
Soft Bricks $159,600 $24,000 $188,000
Hard Bricks 124,000 28,200 163,600
Hard Baked Bricks 102,000 19,600 130,000


a.) What is the optimal product mix that will maximize profits for Zander? (5 Marks)
b.) What is the optimal profit for Zander? (5 Marks)

Answer 1

Answer:

processed further and then sold. The following resulting

Sales Value Additional Da