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5. Product I has been allocated $9,600 of the total joint costs of $12,000. A total of 9,000 units of product Ql are produced from

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5. Product I has been allocated $9,600 of the total joint costs of $12,000. A total of 9,000 units of product Ql are produced from the joint process. Product QI can be sold at the split-off point for $13 per unit , or it can be processed further for an additional total cost of $54,000 and then sold for $18 per unit. If product QI is processed further and sold, what would be the financial advantage (disadvantage) for the company compared with sale in its unprocessed form directly after the split- off point? Put advantage or disadvantage in the second line. I DL 2. A company makes 2,000 widgets. The per unit costs to make a widget are DM 10 3 SUPERVISOR SALARY 1 OTHER VARIABLE MOH 5 DEPRECIATION ON FACTORY EQUIPMENT 1.50 OTHER FIXED MOH 10 [$6 of these costs can be avoided if the widgets are purchased] If the units are purchased instead of made, all variable costs can be avoided and there will be a chance to rent out part of the factory for $15,000. The cost to buy the units is $30 cach unit purchased and the company will have to pay freight-in costs of $560. _What kind of cost is the $15,000? b. What should the company do-make or buy the widgets? c. How much better off will they be with your decision? Show the numbers you use under cach area below. MAKE BUY

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