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Net Realizable Value Method, Decision to Sell at Split-off or Process Further Pacheco, Inc., produces two products, overs and unders, in a single process. The

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Net Realizable Value Method, Decision to Sell at Split-off or Process Further Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $50,000, and 13,000 units of overs and 37,000 units of unders were produced. Separable processing costs beyond the split-off point were as follows: overs, $16,000; unders, $26,180. Overs sell for $2.00 per unit; unders sell for $3.14 per unit. Required: 1. Allocate the $50,000 joint costs using the estimated net realizable value method. Allocated Joint Cost Overs 5,000 Unders 45,000 2. Suppose that overs could be sold at the split-off point for $1.80 per unit. Should Pacheco sell overs at split-off or process them further? Overs should not be processed further as there will be $ 3,000 X more profit if sold at split-off

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