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As a start-up company, Coronado Enterprises encourages its employees to think through the entire value chain to estimate whether it might be worthwhile to take
As a start-up company, Coronado Enterprises encourages its employees to think through the entire value chain to estimate whether it might be worthwhile to take a risk on new products. As part of that program, Nancy is reviewing a product concept that her intern presented to her. The basic idea is to use a common process, which would result in two intermediate products. One product could be sold right away (X). The other product (Y) would have no immediate sales value but after further processing would yield a very highvalue product. Nancy is intrigued enough to dig further into her intern's quantitative analysis, as follows. Based on this information, determine which joint cost allocation method the intern must have used when allocating the joint costs to these products. The intern must have used the method. Calculate how much total cost the intern included in the above estimate for (1) the joint process and (2) further processing of product Y. (Round answers to 0 decimal places, e.g. 5,125.) (1) The joint process $ (2) Further processing of product Y $
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