Marsden manufactures a cat food product called special

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Reference no: EM13568775

Marsden manufactures a cat food product called Special Export. Marsden currently has 17,000 bags of Special Export on hand. The variable production costs per bag are $1.9 and total fixed costs are $17,000. The cat food can be sold as it is for $9.1 per bag or be processed further into Prime Cat Food and Feline Surprise at an additional $3,300 cost. The additional processing will yield 17,000 bags of Prime Cat Food and 4,950 bags of Feline Surprise, which can be sold for $8.1 and $6.1 per bag, respectively.

The net advantage of processing Special Export further into Prime and Feline Surprise would be:

	$167,895
	$13,195
	$9,895
	$3,300
	$164,595

Reference no: EM13568775

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