Yonica Petroleum is a global manufacturer of specialty chemicals that are made from the waste products of the petroleum industry. Yonica in effect recycles a good portion of the waste from the refineries used by the large oil companies. The specialty chemicals are used as cleaning solvents and lubricants in industrial applications. Yonica has three products-Y64, G22, and X17-and total joint production cost of $356,000. Yonica plans to process all three products beyond the split-off point in order to be able to sell the product at the higher price after additional processing.

		Y64	G22	X17	Total
Gallons produced and sold		22,000	45,500	18,000	85,500
Sales price at split-off point		$2.24	$2.88	$0.44
Separable processing cost		$65,500	$34,250	$55,400	155,150
Sales price after additional processing		$10.50	$6.75	$4.22
Number of customers		22	3	46

Required
1. Calculate the product cost of each of the three product lines using the following methods: (a) physical unit method, (b) sales value at split-off method, and (c) the net realizable value method.
2. Which of the three methods do you think would be preferred in this case? Why?
3. While Yonica chose to process all three products beyond the split-off point, do you think this is the correct decision? Which products, if any, do you think should have been processed beyond the split-off point, and why?

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64 G22 17 Tota $ 1050 S 675 422 Price ater adftl processin) Gallns Produced and Sld Separable Procesin cost Sale Pice at Splt-of Sales Vale lafteradl processing SalesV/aue a Splitof crease in Sales Vaue-Separable Cost 220005500800 85.500 6600 34250 S 5 400 S 155,150 224 288 044 614085 5 49280 S131,040 S 7,920 $ 188240 231,000 S 307,125 75960 116220 S141.835 S 12640