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ABC Co. develops four mobile applications in a joint process as follows: Hunger station Talabat Mrsool Tawakalna Total Applications downloaded 52,000 60,000 18,000 28,000 158,000
ABC Co. develops four mobile applications in a joint process as follows: | ||||||||||
Hunger station | Talabat | Mrsool | Tawakalna | Total | ||||||
Applications downloaded | 52,000 | 60,000 | 18,000 | 28,000 | 158,000 | |||||
Sales value at split off | $240,000 | $40,000 | $10,000 | $35,000 | $325,000 | |||||
Additional cost if developed further | $28,000 | $40,000 | $20,000 | $15,000 | $103,000 | |||||
Sales value if processed further | $280,000 | $60,000 | $15,000 | $45,000 | $400,000 | |||||
Joint costs | $250,000 | |||||||||
Required: | ||||||||||
(a) Determine which products should be sold at split-off and which should be processed further (show supporting calculations/schedule). | ||||||||||
(b) Assuming the company makes decisions that are in its best interests for overall profitability, what would be the company's gross margin? |
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