Question: Sell at Split-Off or Process Further Bozo Inc, manufactures two products from a joint production process. The Joint process costs $110,000 and yields 6,000 pounds
Sell at Split-Off or Process Further Bozo Inc, manufactures two products from a joint production process. The Joint process costs $110,000 and yields 6,000 pounds of LTE compound and 14,000 pounds of HS compound. LTE can be sold at split-off for $55 per pound. HS can be sold at split-off for $9 per pound. A buyer of HS asked Bozo to process HS further into cs compound. If Hs were processed further, it would cost $34,000 to turn 14,000 pounds of HS into 4,000 pounds of cs. Th CS would sell for $45 per pound. Required: 1. What is the contribution to income from selling the 14,000 pounds of HS at split-off? 2. CONCEPTUAL CONNECTION: What is the contribution to income from processing the 14,000 pounds of Hs into 4,000 pounds of CS? Should Bozo continue to sell the HS at split-offer process it further into Cs
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