Ibsen Company makes two products from a common input Joint processing costs up to the split off point total $48,000 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 $ 19,200 $ 28,800 $ 48,000 Sales value at split off point $ 20,000 $ 30,000 $ 50,000 Costs of further processing $ 24,700 $ 19,000 $ 43,700 Sales value after further processing $ 38,800 $ 59,300 $ 98,100 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

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

Question: Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $48,000 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 $48,000 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	$	19,200	$	28,800	$	48,000
Sales value at split-off point	$	20,000	$	30,000	$	50,000
Costs of further processing	$	24,700	$	19,000	$	43,700
Sales value after further processing	$	38,800	$	59,300	$	98,100

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?

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!

Problem 6-42 Continuation of Preceding Problem; Computing Least- Squares Regression Estimates; Comparing Multiple Methods (Appendix) (LO 6-1, 6-2, 6-5, 6-6, 6-8) [The following information applies to...

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...

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 $42,500 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 $41,500 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 $42,500 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 $48,500 a year. The company allocates these costs to the joint products on the basis of...

Kabutell, Inc. had net income of $750,000, cash flow from financing activities of $50,000, depreciation expenses of $50,000, and cash flow from operating activities of $575,000. Calculate the quality...

Derive expressions for (a) u. (b) h. (c) s for a gas that obeys the van der Waals equation of state for an isothermal process.

? _ _ _ _ _ _ _ _ _ _ _ _ a r e m u t u a l f u n d s t h a t e n g a g e i n m a r k e t t i m i n g . T h e y v a r y t h e p r o p o r t i o n s o f f u n d s i n v e s t e d i n s t o c k s o r b...

SIMAD UNIVERSITY Class: BACC25 Subject: Islamic Accounting Instructions: a) Follow The Instructions. Midterm Exam Instructor: All Ibrahim Date: 6-4-2022 b) You Have 1.5 Hrs. To Complete This Test. c)...

Did the event wind up costing the members any money? Thanks to the donations of local restaurants and supplies provided by the county sanitation department, the event cost the group absolutely...

1. Your chemistry professor assigned a full-semester group project and has asked you to take the lead in your group because chemistry is your best subject. When it comes down to assigning your tasks...

Consider three groups to which you belong. Is there a clearly established leader for each group? If so, what type of power does this leader have? Do you find certain types of power more ethical or...