Determine whether to sell or process further—joint products. E7.23 (LO 4) Excel Bahrat Inc. produces three separate products from a comm mmon process costing $100,000. Each of the products can be sold at the split-off point or can be processed further and then sold for a higher price. The cost and selling price data for a recent period are as follows: Sales Value at Split-Off Point $50,000 10,000 60,000 Cost to Process Further Product 12 Product 14 Product 16 Instructions a. Determine the total net income if all products are sold at the split-off point. b. Determine the total net income if all products are sold after further processing. c. Using incremental analysis, determine which products should be sold at the split-off point and which should be processed further. d Determine the total net income using the results from part (c) and explain why the net income is Sales Value after Further Processing $100,000 30,000 150,000 $190,000 35,000 220,000
Determine whether to sell or process further—joint products. E7.23 (LO 4) Excel Bahrat Inc. produces three separate products from a comm mmon process costing $100,000. Each of the products can be sold at the split-off point or can be processed further and then sold for a higher price. The cost and selling price data for a recent period are as follows: Sales Value at Split-Off Point $50,000 10,000 60,000 Cost to Process Further Product 12 Product 14 Product 16 Instructions a. Determine the total net income if all products are sold at the split-off point. b. Determine the total net income if all products are sold after further processing. c. Using incremental analysis, determine which products should be sold at the split-off point and which should be processed further. d Determine the total net income using the results from part (c) and explain why the net income is Sales Value after Further Processing $100,000 30,000 150,000 $190,000 35,000 220,000
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter11: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 11.2.6P: Break-even sales under present and proposed conditions Kearney Company, operating at full capacity,...
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