ABC Company makes two products from a common input Joint processing costs up to the split off point total $51,500 a year The company allocates these costs to the joint products on the basis of their total sales values at the split off point Each product may be sold at the split off point or processed further Data concerning these products appear below Product A Product B Total Allocated joint processing costs $ 30,900 $ 20,600 $ 51,500 Sales value at split off point $ 30,000 $ 20,000 $ 50,000 Costs of further processing $ 23,200 $ 17,500 $ 40,700 Sales value after further processing $ 48,600 $ 56,300 $ 104,900 Required a What is financial advantage (disadvantage) of processing Product A beyond the split off point (Negative amount should be indicated by a minus sign ) b What is financial advantage (disadvantage) of processing Product B beyond the split off point c What is the minimum amount the company should accept for Product A if it is to be sold at the split off point d What is the minimum amount the company should accept for Product B if it is to be sold at the split off point Garrison 16e Rechecks 2017 12 15

The Answer is in the image, click to view ...

Question: ABC Company makes two products from a common input. Joint processing costs up to the split-off point total $51,500 a year. The company allocates these

ABC Company makes two products from a common input. Joint processing costs up to the split-off point total $51,500 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below:

	Product A		Product B		Total
Allocated joint processing costs	$	30,900	$	20,600	$	51,500
Sales value at split-off point	$	30,000	$	20,000	$	50,000
Costs of further processing	$	23,200	$	17,500	$	40,700
Sales value after further processing	$	48,600	$	56,300	$	104,900

Required:

a. What is financial advantage (disadvantage) of processing Product A beyond the split-off point? (Negative amount should be indicated by a minus sign.)

b. What is financial advantage (disadvantage) of processing Product B beyond the split-off point?

c. What is the minimum amount the company should accept for Product A if it is to be sold at the split-off point?

d. What is the minimum amount the company should accept for Product B if it is to be sold at the split-off point?

Garrison 16e Rechecks 2017-12-15

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $47,500 a year. The company allocates these costs to the joint products on the basis of...

help) Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $42,000 a year. The company allocates these costs to the joint products on the basis...

Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $42,500 a year. The company allocates these costs to the joint products on the basis of...

Iaukea Company makes two products from a common input. Joint processing costs up to the split-off point total $51,300 a year. The company allocates these costs to the joint products on the basis of...

bsen Company makes two products from a common input. Joint processing costs up to the splitoff point total $48,500 a year. The ompany allocates these costs to thejoint products on the basis of their...

Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $51,500 a year. The company allocates these costs to the joint products on the basis of...

12:12 .. 3G Search X Final Assessment_ACCT603_51 202... a. Gazi Corporation produces three products. Data concerning the selling prices and unit costs of the three products appear below: Product...

Iaci Company makes two products from a common input. Joint processing costs up to the split-off point total $46,300 a year. The company allocates these costs to the joint products on the basis of...

Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $51,500 a year. The company allocates these costs to the joint products on the basis of...

Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $50,500 a year. The company allocates these costs to the joint products on the basis of...

1. What type of organizational structure tends to concentrate all international expertise in one division? 2. An organizational structure that divides worldwide operations according to a firms...

The combined equation of the straight lines passing through the point (4, 3) and each line making intercepts on the coordinate axes whose sum is'- l'is (A) (3x 2y + 6) (z- 2y- 2) = 0 (B) (3x 2y +...

13.51 Show that the mean square error s2 = SSE k(n 1) for the analysis of variance in a one-way classification is an unbiased estimate of 2 .

Hypothesis Testing of a Single Mean LCTCS Tuition: Louisiana Community And Technical College System consist of 2 community colleges across the state. I think RPCC's tuition and fees is lower than the...

1 What is the relationship between cultural values and people management practices? What are the shortcomings of this approach in understanding people management practices in different countries?...

3 What measures can a management team take to successfully set up operations in another country, where the local culture is different from their own?

2 What are the main causes of cultural clashes between managers from Sweden and employees in Spain? What can be done to lessen the negative aspects and to strengthen the synergies between the two...