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Product X and Y are made from a common input. Joint processing costs up to the split-off point total $47,000 a year. The company allocates
Product X and Y are made from a common input. Joint processing costs up to the split-off point total $47,000 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below: Allocated joint processing costs Sales value at split-off point Costs of further processing Sales value after further processing Product X $18,400 $25,650 $22,900 $48,000 Product Y $28,600 $37,400 $17,200 $55,700 Total $ 47,000 $ 63,050 $ 40,100 $103,700 Required: a. What is financial advantage (disadvantage) of processing Product X beyond the split-off point? (Negative amount should be indicated by a minus sign.) b. What is financial advantage (disadvantage) of processing Product Y beyond the split-off point? (Negative amount should be indicated by a minus sign.)
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