What is the differential revenue of producing Product D?
A)$14 per pound
B)$8.75 per pound
C)$7 per pound
D)$5.25 per pound

Question

Quizplus · Accepted Answer

Differential revenue is the difference between the selling price and the variable cost per unit. For Product D, the selling price is $20 per pound and the variable cost is $11.25 per pound. Therefore, the differential revenue is $20 - $11.25 = $8.75 per pound.

What Is the Differential Revenue of Producing Product D