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A company manufactures three products using the same production process. The costs incurred up to the split-off point are $168,000. These costs are allocated to the products on the basis of their sales value at the split-off point. The number of units produced, the selling prices per unit of the three products at the split-off point and after further processing, and the additional processing costs are as follow: Product (a) X Y Z Number of Units Produced 4,200 8,400 3,360 Selling Price at Split-off $11.00 11.90 19.70 Selling Price after Processing $16.00 16.50 21.90 should be processed further but Additional Processing Costs $11,760 17,640 10,080 Which product(s) should be processed further and which should be sold at the split-off point? should be sold at the split-off point.

A company manufactures three products using the same production process. The costs incurred up to the split-off point are $168,000. These costs are allocated to the products on the basis of their sales value at the split-off point. The number of units produced, the selling prices per unit of the three products at the split-off point and after further processing, and the additional processing costs are as follow: Product (a) X Y Z Number of Units Produced 4,200 8,400 3,360 Selling Price at Split-off $11.00 11.90 19.70 Selling Price after Processing $16.00 16.50 21.90 should be processed further but Additional Processing Costs $11,760 17,640 10,080 Which product(s) should be processed further and which should be sold at the split-off point? should be sold at the split-off point.

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 10CE: A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each...
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A company manufactures three products using the same production process. The costs incurred up to the split-off point are $168,000. These costs are allocated to the products on the basis of their sales value at the split-off point. The number of units produced, the selling prices per unit of the three products at the split-off point and after further processing, and the additional processing costs are as follow: Product (a) X Y Z Number of Units Produced 4,200 8,400 3,360 Selling Price at Split-off $11.00 11.90 19.70 Selling Price after Processing $16.00 16.50 21.90 should be processed further but Additional Processing Costs $11,760 17,640 10,080 Which product(s) should be processed further and which should be sold at the split-off point? should be sold at the split-off point.
Transcribed Image Text:A company manufactures three products using the same production process. The costs incurred up to the split-off point are $168,000. These costs are allocated to the products on the basis of their sales value at the split-off point. The number of units produced, the selling prices per unit of the three products at the split-off point and after further processing, and the additional processing costs are as follow: Product (a) X Y Z Number of Units Produced 4,200 8,400 3,360 Selling Price at Split-off $11.00 11.90 19.70 Selling Price after Processing $16.00 16.50 21.90 should be processed further but Additional Processing Costs $11,760 17,640 10,080 Which product(s) should be processed further and which should be sold at the split-off point? should be sold at the split-off point.
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