EXERCISE 6-13 Sell or Process Further Decision L06-7 Wexpro, Inc., produces several products from processing 1 ton of clypton, a rare mineral. Mate- rial and processing costs total $60,000 per ton, one-fourth of which is allocated to product X15. Seven thousand units of product X15 are produced from each ton of clypton. The units can either be sold at the split-off point for $9 each, or processed further at a total cost of $9,500 and then sold for $12 each. Required: What is the financial advantage (disadvantage) of further processing product X15? Should product X15 be processed further or sold at the split-off point? 1. 2.
EXERCISE 6-13 Sell or Process Further Decision L06-7 Wexpro, Inc., produces several products from processing 1 ton of clypton, a rare mineral. Mate- rial and processing costs total $60,000 per ton, one-fourth of which is allocated to product X15. Seven thousand units of product X15 are produced from each ton of clypton. The units can either be sold at the split-off point for $9 each, or processed further at a total cost of $9,500 and then sold for $12 each. Required: What is the financial advantage (disadvantage) of further processing product X15? Should product X15 be processed further or sold at the split-off point? 1. 2.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:EXERCISE 6-13 Sell or Process Further Decision L06-7
Wexpro, Inc., produces several products from processing 1 ton of clypton, a rare mineral. Mate-
rial and processing costs total $60,000 per ton, one-fourth of which is allocated to product X15.
Seven thousand units of product X15 are produced from each ton of clypton. The units can either
be sold at the split-off point for $9 each, or processed further at a total cost of $9,500 and then
sold for $12 each.
Required:
What is the financial advantage (disadvantage) of further processing product X15?
Should product X15 be processed further or sold at the split-off point?
1.
2.
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