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Asseco Poland S.A. uses a joint process to produce products SSSS, TTTT, UUUU, and VVVV. Each product may be sold at its split-off point or
Asseco Poland S.A. uses a joint process to produce products SSSS, TTTT, UUUU, and VVVV. Each product may be sold at its split-off point or processed further. Joint processing costs for a single batch of joint products are $280,000. Other relevant data are as follows:
Product | Sales Value At Split-Off | Additional Costs of Processing | Sales Value of Final Product |
---|---|---|---|
SSSS | $42,000 | $46,000 | $92,000 |
TTTT | 56,000 | 40,000 | 84,000 |
UUUU | 48,000 | 43,000 | 86,000 |
VVVV | 36,000 | 34,000 | 62,000 |
Requirements:
- Analyze the profitability of processing Product SSSS further beyond the split-off point.
- Calculate the net benefit of processing Product TTTT beyond the split-off point.
- Allocate joint costs using the constant gross margin percentage method.
- Prepare a profitability analysis report for Asseco Poland S.A.
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