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QUESTION 5 MacGyver Company makes two products from a common input. Joint processing costs up to the split-off point total $45,500 a year. The company
QUESTION 5 MacGyver Company makes two products from a common input. Joint processing costs up to the split-off point total $45,500 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: Sales value at split-off point Costs of further processing Sales value after further processing Product X $30,000 $24,200 $47,800 Product Y $20,000 $18,500 $58,300 Total $50,000 $42,700 $106,100 Required: Show your work 15 points a. What amount of joint product cost would be allocate to each product? b. What is financial advantage (disadvantage) of processing of each product beyond the split- off point? c. What is the minimum amount the company should accept for each product if it is to be sold at the split-off point
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