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Canning Company uses a joint process to produce products W, X, Y, and Z. Each product may be sold at its split-off point or processed

  1. Canning Company uses a joint process to produce products W, X, Y, and Z. Each product may be sold at its split-off point or processed further. Additional processing costs of specific products are entirely variable. Joint processing costs for a single batch of joint products are $120,000. Other relevant data are as follows:
    Sales Value Additional Sales Value of
    Product at Split-Off Processing Costs Final Product
    W $ 40,000 $ 60,000 $ 80,000
    X $ 12,000 $ 4,000 $ 20,000
    Y $ 20,000 $ 32,000 $120,000
    Z $ 28,000 $ 20,000 $ 32,000
    $100,000 $116,000 $252,000
    Which of the following actions should be taken by Canning?

    a.Process W further.

    b.Process Y further.

    c.Sell X now.

    d.Process Z further.

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