Excel is considering processing product

Question

Excel Company has costs of $100,000 up to split off. At split off, it has 1000 units of Product A and 2000 units of Product B. Product A sells for $48 per unit and Product B sells for $62 per unit.

Excel is considering processing Product B to the next stage where it would then sell for $68 per unit. Added costs are $20,000. If they do this, what will be the effecton net income.

Question 19 options:

	Net income will increase by $16,000.
	Net income would decrease by $8000.
	Net income would increase by $10,000.
	Net income would increase by $4000.