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The management of Delta Sugar Company is considering whether toprocess further raw sugar into refined sugar. Refined sugarcan be sold for $1.75 per pound, and raw sugar can be sold withoutfurther processing for $1.05 per pound. Raw sugar is producedin batches of 24,000 pounds by processing 90,000 pounds of sugarcane, which costs $0.25 per pound. Refined sugar will requireadditional processing costs of $0.36 per pound of raw sugar, and1.2 pounds of raw sugar will produce 1 pound of refined sugar.
Instructions:
1. Inventory in the amount of $10,000 was received on December 31 after the count. The invoice was received and recorded on December 30.
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