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Poppy & George Corporation manufactures two products (007 & 008) from a joint process. The two products can be sold at the split-off point as
Poppy & George Corporation manufactures two products (007 & 008) from a joint process. The two products can be sold at the split-off point as intermediate grade products or processed further into premium grade products. Costs related to each batch of production are as follows: 007 Sales value at the split-off point $16,000 Allocated joint costs $ 6,000 Sales value after further processing $20,000 Cost of further processing $ 5,000 008 $12,000 $ 6,000 $18,000 $ 3,000 For which product(s) would it be more profitable for Poppy & George to sell at the split-off point rather than process further? O 007 only O 008 only O Both 007 & 008 Neither 007 or 008
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