Split Company produces three products X, Y, and Z from a joint process. Each product
Question:
Split Company produces three products — X, Y, and Z — from a joint process. Each product may be sold at the split-off point or processed further. Additional processing requires no special facilities, and production costs of further processing are entirely variable and traceable to the products involved. Last year all three products were processed beyond split-off. Joint production costs for the year were $120,000. Sales values and costs needed to evaluate Split's production policy follow.
| Sales Value | Additional Costs | |||
|---|---|---|---|---|
| Product | Units Produced | Sales Value at Split Off | If Processed Further | |
| x | 6,000 | $ 40,000 | $ 80,000 | $ 1,200 |
| y | 3,000 | 15,000 | 40,000 | 3,000 |
| z | 1,000 | 16,000 | 30,000 | 1,500 |
The amount of joint costs allocated to product X using the sales value at split-off method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
Multiple Choice
$20,341.
$25,352.
$27,042.
$33,687.
$67,606.
