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any help appreciated E7-12 A company manufactures three products using the same production process. The costs incurred up to the split-off point are $200,000. These
any help appreciated
E7-12 A company manufactures three products using the same production process. The costs incurred up to the split-off point are $200,000. These costs are allocated to the prod. ucts 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 pro- cessing, and the additional processing costs are as follows. Number of Selling Price Selling Price Additional Product Units Produced at Split-Off after Processing Processing Costs D 4,000 $10.00 $15.00 $14,000 E 6,000 11.60 16,20 20,000 F 2,000 19.40 22.60 9,000 Instructions (a) Which information is relevant to the decision on whether or not to process the prod. ucts further? Explain why this information is relevant. (b) Which product(s) should be processed further and which should be sold at the split- off point? (e) Would your decision be different if the company was using the quantity of output to allocate joint costs? ExplainStep by Step Solution
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