Question: Iaci Company makes two products from a common input. Joint processing costs up to the split-off point total $51,200 a year. The company allocates these
| Iaci Company makes two products from a common input. Joint processing costs up to the split-off point total $51,200 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 X | Product Y | Total | ||||
| Allocated joint processing costs | $ | 19,900 | $ | 31,300 | $ | 51,200 |
| Sales value at split-off point | $ | 24,350 | $ | 38,350 | $ | 62,700 |
| Costs of further processing | $ | 24,400 | $ | 18,700 | $ | 43,100 |
| Sales value after further processing | $ | 48,200 | $ | 58,700 | $ | 106,900 |
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Required a. What is the net monetary advantage (disadvantage) of processing Product X beyond the split-off point? (Input the amount as a positive value.) Net b. What is the net monetary advantage (disadvantage) of processing Product Y beyond the split-off point? (Input the amount as a positive value.) Net c. What is the minimum amount the company should accept for Product X if it is to be sold at the split-off point? Minimum acceptable amount
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