SAMCIS Company produces three products (X, Y, and Z) in a joint process costing P100,000. The products can be sold as they leave the process, or they can be processed further and sold. The cost accountant has provided you with the following information: Separable Further Processing Costs P60,000 50,000 90,000 Sales Price at Split-Off Sales Price After Product Unit Volume Further Processing 3,000 4,000 8,000 P10 15 P25 30 Y 20 35 Assume that all processing costs are variable costs. Required:/ Which products should SAMCIS sell at split-off, and which products should be processed further?

SAMCIS Company produces three products (X, Y, and Z) in a joint process costing P100,000. The products can be sold as they leave the process, or they can be processed further and sold. The cost accountant has provided you with the following information: Separable Further Processing Costs P60,000 50,000 90,000 Sales Price at Split-Off Sales Price After Product Unit Volume Further Processing 3,000 4,000 8,000 P10 15 P25 30 Y 20 35 Assume that all processing costs are variable costs. Required:/ Which products should SAMCIS sell at split-off, and which products should be processed further?

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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Listmann Corporation processes four different products that can either be sold as is or processed further. Listed below are sales and additional cost data: Sales Value with no further Additional Processing Sales Value after further Product Processing Costs processing Premier $ 1,350 $ 900 $ 2,700 Deluxe 450 225 630 Super 900 450 Basic 90 45 1,800 180 Which product(s) should not be processed further?
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Division A of SLG Company produces a part it sells to other companies. Sales and cost data for the part are as follows: Capacity in units 60,000 units Selling price per unit O $27 per unit O $39 per unit O $36 per unit O $41 per unit Variable cost per unit O None of the above. Fixed cost per unit at capacity Division B, another division of SLG Company, would like to buy this part from Division A. Division B is currently purchasing the part from an outside source at $38 per unit. If Division A sells to Division B, then $1 in Division A's variable costs can be avoided. Assume Division A has enough idle capacity to handle all of Division B's needs without any increase in fixed costs and without interfering with outside sales. According to the transfer pricing guidelines, what is the lowest acceptable transfer price from the perspective of Division A? $40 per unit $28 per unit $9 per unit
Sunland Inc. produces three separate products from a common process costing $100,100. Each of the products can be sold at the split- off point or can be processed further and then sold for a higher price. Shown below are cost and selling price data for a recent period. Product 10 Product 12 Product 14 (c) Product Your answer is partially correct. Product 10 Product 12 Product 14 $ Sales Value at Split-Off Point $59,700 $ 15,800 $ 55,400 Calculate incremental profit/(loss) and determine which products should be sold at the split-off point and which should be processed further. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Incremental profit (loss) Cost to Process Further eTextbook and Media $100,100 30,800 149,700 Sales Value after Further Processing $191,000 34,700 Decision 214,000 Should be processed further Should be sold at the split-off point Should be processed further Assistance Used