Question: 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

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 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$28,500$19,000$47,500Sales value at split-off point$30,000$20,000$50,000Costs of further processing$24,600$18,900$43,500Sales value after further processing

$48,600$59,100$107,700

Required:

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

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

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

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

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