Net Realizable Value Method, Decision to Sell at Split$-$off or Process Further

beyond the split$-$off point were as follows: ins, $$17,500$; outs, $$9,000.$ Ins sell for $$8\mathrm{.}00$ per unit; outs sell for $$15\mathrm{.}00$ per unit.

Required:

Allocate the $$77,300$ joint costs using the estimated net realizable value method.

Suppose that ins could be sold at the split$-$off point for $$7\mathrm{.}00$ per unit. Should Arvin sell ins at split$-$off or process them further?

Ins

$$ be processed further as there will be :

$$ profit if sold at split$-$off.

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$$ Check My Work

done as close to the split$-$off point as possible.

Compare what would happen if sold at split$-$off and what would happen with further processing.