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Walman Corp. manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products based on relative sales values of

Walman Corp. manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products based on relative sales values of the products at the split-off point. Additional information is as follows:

Units Produced

X - 15,000

Y - 11,000

Z - 7,000

Total 33,000

Allocated joint costs

X - $195,200

Y - $109,800

Z - $85,400

Total - $390,400

Sales value at split-off

X- ?

Y - 180,000

Z - 140,000

Total - 640,000

Additional costs for further processing

X - 41,000

Y- 33,000

Z- 24,000

Total - 98,000

Sales value if processed further

X - 326,000

y- 223,000

Z - 185,000

Total - 734,000

Based solely on a relevant cost analysis, which of the three products should be processed by Walman beyond the split-off point?

  • Only X
  • Only Y
  • Only Z
  • Only Y and Z
  • All three products: X,Y and Z

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