Part 3 contains 2 Decision making recommendations that are independent of each other. Covers material in Module 17.

Make sure you show your work.

Decision Making #1-Sell or Process Further Joint Product Decision

XYZ manufactures A and B from a joint process cost = $70,000. Six thousand pounds of A can be sold at split-off for $20 per pound or processed further at an

additional cost of $10,000 and then sold for $22. Ten thousand pounds of B can be sold at split-off for $15 per pound or processed further at an additional cost of $12,000 and later sold for $18.

Required:

Which products should be processed further or not? Why? Give the total dollar impact to income for each product based on your recommendation. I am not looking for per unit information, but how each decision will impact the company's income in total.

Recommendation: