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Question 2* Question 2 Kokoy has 50,000 units of partially finished product J. Processing costs to date are P50,000. The 50,000 unfinished units can be sold as is, for P100,000 or they can be processed further to produce finished products 1A, 2B, and 3C. Processing the units further will cost an additional P80,000 and will yield total revenues of P200,000. Kokoy must decide whether the added revenues from selling finished products 1A, 2B, and 3C, exceed the costs of finishing them. Show the computation and decision Kokoy should make.

Question 2* Question 2 Kokoy has 50,000 units of partially finished product J. Processing costs to date are P50,000. The 50,000 unfinished units can be sold as is, for P100,000 or they can be processed further to produce finished products 1A, 2B, and 3C. Processing the units further will cost an additional P80,000 and will yield total revenues of P200,000. Kokoy must decide whether the added revenues from selling finished products 1A, 2B, and 3C, exceed the costs of finishing them. Show the computation and decision Kokoy should make.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 2* Question 2 Kokoy has 50,000 units of partially finished product J. Processing costs to date are P50,000. The 50,000 unfinished units can be sold as is, for P100,000 or they can be processed further to produce finished products 1A, 2B, and 3C. Processing the units further will cost an additional P80,000 and will yield total revenues of P200,000. Kokoy must decide whether the added revenues from selling finished products 1A, 2B, and 3C , exceed the costs of finishing them. Show the computation and decision Kokoy should make.
Transcribed Image Text:Question 2* Question 2 Kokoy has 50,000 units of partially finished product J. Processing costs to date are P50,000. The 50,000 unfinished units can be sold as is, for P100,000 or they can be processed further to produce finished products 1A, 2B, and 3C. Processing the units further will cost an additional P80,000 and will yield total revenues of P200,000. Kokoy must decide whether the added revenues from selling finished products 1A, 2B, and 3C , exceed the costs of finishing them. Show the computation and decision Kokoy should make.
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