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Old MathJax webview Problem Norton Company produces three products from a common process: X1, Y2, and Z3. The joint costs total $262,500 and joint processing
Old MathJax webview
Problem Norton Company produces three products from a common process: X1, Y2, and Z3. The joint costs total $262,500 and joint processing results in 15,000 pounds of X1, 20,000 pounds of Y2, and 4,000 gallons of Z3. At split-off, Norton can sell X1 for $16 per pound, Y2 for $8 per pound, and Z3 for $25 per gallon. Alternatively, the products can be processed further. The costs to process further and selling price after further processing are as follows: Product Further Processing Costs Selling Price X1 Y2 Z3 $63,000 $80,000 $36,000 $20 per pound $13 per pound $32 per gallon Question 1 For each product, what is the differential amount to process further? Handwrite your answer on the format provided on page 2. Question 2 Which product(s) should be sold at the split-off point and which should be sold after further processing? Briefly explain why given your prior analysis. Handwrite your answer in the space provided on page 2
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