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ABC Company processes direct materials up to the split-off point where two products, A and B, are obtained. The following information was collected for the

ABC Company processes direct materials up to the split-off point where two products, A and B, are obtained. The following information was collected for the month of July:

 

Direct materials processed:            3,000 liters (with 15% shrinkage)

 

Production:        A                     600 liters

                            B                      1,950 liters

 

Sales:                A                     $35.00 per liter

                          B                      $30.00 per liter

 

The cost of purchasing 3,000 liters of direct materials and processing it up to the split-off point to yield a total of 2,550 liters of good products was $7,500. There were no inventory balances of A and B. Product A may be processed further to yield 500 liters of Product Z5 for an additional processing cost of $170. Product Z5 is sold for $24 per liter. There was no beginning inventory and ending inventory was 125 liters. Product B may be processed further to yield 1,785 liters of Product W3 for an additional processing cost of $325. Product W3 is sold for $35 per liter. There was no beginning inventory and ending inventory was 25 liters.  If Product Z5 and Product W3 are produced, what are the expected sales values of production, respectively?


 

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