Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three...

 

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Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows: Sales value at split-off point Allocated joint costs Sales value after further processing Cost of further processing NY29 P5,000 P6,000 P9,000 P2,000 TX38 CA55 P12,000 P16,000 P6,000 P6.000 P20,000 P18,000 P5.000 P3,000 For which product(s) above would it be more profitable for Agao to sell at the split-off point rather than process further? Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows: Sales value at split-off point Allocated joint costs Sales value after further processing Cost of further processing NY29 P5,000 P6,000 P9,000 P2,000 TX38 CA55 P12,000 P16,000 P6,000 P6.000 P20,000 P18,000 P5.000 P3,000 For which product(s) above would it be more profitable for Agao to sell at the split-off point rather than process further?

Answer rating: 100% (QA)

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