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PART A a) Joint cost is the cost of a single production process that yields multiple products simultaneously. Are joint cost relevant in a sell
PART A a) Joint cost is the cost of a single production process that yields multiple products simultaneously. Are joint cost relevant in a sell or process further decision? Explain. XYZ Sdn Bhd manufactures three (3) products from a common input. The joint cost of the process is RM 380,000. Additional information is as follows: Product Output per Quarter X Y Z Selling Price RM 18 10 20 16,000 pounds 21,000 pounds 5,100 gallons Required: b) Calculate the joint cost allocated to product X, Y & Z using the sales value at split of method. Assume that each of the above products can be processed further after the split of point. No special facilities are required for this additional processing. The additional processing costs and the unit selling price after processing further is tabulated below: Product Additional Processing Cost RM 70,000 81,000 34,000 X Y Z Selling Price RM 22 per pound 15 per pound 25 per gallon Required c) Based on the data provided, which product should be sold at the split off point and which product should be processed further? Show your computations
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