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Whitehall Corporation produces chemicals used in the cleanng industry During the previous month Whitehall incurred $300,000 of joint costs in producing 60,000 units of AM-12
Whitehall Corporation produces chemicals used in the cleanng industry During the previous month Whitehall incurred $300,000 of joint costs in producing 60,000 units of AM-12 and 40,000 un ts of BM36. Whitehall uses the units-of-production method to allocate joint costs. Currently, AM-12 is sold at spla-off for $3.50 per unit. Flank Corporation has approached Whitehall to purchase al of the production of AM-12 afler further processing. The further processing will cost Whitehall $90,000 Concerning AM-12, which one of the followng altematives is most advantageous? A. Whitehall should process further and sell to Flank if the total seling price per unit after further processing is greater than $150, which covers the incremental costs B. Whitohall should process further and sell to Flank it the total selling price per unit after further processing is greater than $3.00, which covers the joint costs C. Whitehall should continve to sell at split off unless Flank ofters at least $450 por unt after further processing, which covers Whitehairs lotal costs. D. Whitohal shouid process further and soll fo Flank if the total soling price per unit afler further processing is greater then $5.00 Whitehall Corporation produces chemicals used in the cleanng industry During the previous month Whitehall incurred $300,000 of joint costs in producing 60,000 units of AM-12 and 40,000 un ts of BM36. Whitehall uses the units-of-production method to allocate joint costs. Currently, AM-12 is sold at spla-off for $3.50 per unit. Flank Corporation has approached Whitehall to purchase al of the production of AM-12 afler further processing. The further processing will cost Whitehall $90,000 Concerning AM-12, which one of the followng altematives is most advantageous? A. Whitehall should process further and sell to Flank if the total seling price per unit after further processing is greater than $150, which covers the incremental costs B. Whitohall should process further and sell to Flank it the total selling price per unit after further processing is greater than $3.00, which covers the joint costs C. Whitehall should continve to sell at split off unless Flank ofters at least $450 por unt after further processing, which covers Whitehairs lotal costs. D. Whitohal shouid process further and soll fo Flank if the total soling price per unit afler further processing is greater then $5.00
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