Assume a company has three products-A, B, and C-that emerge from a joint process. The joint processing costs that are incurred up to the split-off point equal $1,270,000. The selling prices and outputs for each product at the split-off point are as follows: Product Selling Price Output A $ 33 $29 $24 B C per pound 14,000 pounds per pound 18,000 pounds per pound 19,000 pounds

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Assume a company has three products-A, B, and C-that emerge from a joint process. The joint processing costs that
are incurred up to the split-off point equal $1,270,000. The selling prices and outputs for each product at the split-off
point are as follows:
Product Selling Price Output
A
$ 33
$ 29
C $24
B
per pound 14,000 pounds
per pound 18,000 pounds
per pound 19,000 pounds
Each product can be processed further beyond the split-off point. The additional processing costs for each product and
their respective selling prices after further processing are as follows:
Product Additional Processing Costs Selling Price
A
$ 65,000
$37
$ 72,000
$34
$ 88,000
$30
B
с
per pound
per pound
per pound
The company is trying to decide whether to retain or discontinue the entire joint manufacturing process. What is the
financial advantage (disadvantage) of continuing to operate the entire joint manufacturing process?
Transcribed Image Text:Assume a company has three products-A, B, and C-that emerge from a joint process. The joint processing costs that are incurred up to the split-off point equal $1,270,000. The selling prices and outputs for each product at the split-off point are as follows: Product Selling Price Output A $ 33 $ 29 C $24 B per pound 14,000 pounds per pound 18,000 pounds per pound 19,000 pounds Each product can be processed further beyond the split-off point. The additional processing costs for each product and their respective selling prices after further processing are as follows: Product Additional Processing Costs Selling Price A $ 65,000 $37 $ 72,000 $34 $ 88,000 $30 B с per pound per pound per pound The company is trying to decide whether to retain or discontinue the entire joint manufacturing process. What is the financial advantage (disadvantage) of continuing to operate the entire joint manufacturing process?
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