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Solex Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $96,000 per
Solex Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $96,000 per year. The company allocates these costs to the joint products on the basis of their total sales value at the split-off point. These sales values are as follows product X, $51,000; product Y, $91,000; and product Z, $64,000 Each product may be sold at the split-off point or process special facilities. The additional product (on an annual basis) are shown below: ed further. Additional processing requires no processing costs and the sales value after further processing for each Sales Value after Further Processing Additional Product Processing Costs $ 40,000 $40,000 $ 11,000 77,000 $ 156,000 $ 84,000 Required a. Compute the incremental profit (loss) for each product. Product X ProductY Product Z Sales value after further SSI Sales value at split-off point Incremental revenue Cost of further processing Incremental profit (loss)
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