Yellow Manufacturing Company Produces Three Products Using a Joint Process

question 7

Multiple Choice

Yellow Manufacturing Company produces three products using a joint process that accumulates $25,000 in joint costs.The products, A, B, and C, can be sold at split?off or processed further and then sold.The production level for each product is 10,000 units.The following unit information is also available: $\begin{array}{rlc} && \text { Separable } & \\&& \text { Processing } & \\&\text { Sales Value } & \text { Costs after } & \text { Sales Value } \\\text { Product} & \text { at Split-off } & \text { Split-off } & \text { at Completion }\\\text { A } & \$ 12 & \$ 9 & \$ 21 \\\text { B } & 10 & 4 & 17 \\\text { C } & 15 & 6 & 19\end{array}$ Product B _____.

• A)should be processed further to increase profits by $70,000
• B)should be sold at split?off to maximize profits
• C)should be processed further to increase profits by $3 per unit
• D)can be processed further or sold at split?off; it makes no difference

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Definitions:

Cause-and-effect

A relationship between events or things, where one is the result of the other or others, a combination of action and reaction.

Employee Turnover

The rate at which employees leave a company and are replaced by new employees.

Priority

The status established among tasks or concerns to indicate the order in which they should be addressed or considered.

Rich Medium

A communication channel that allows for the transmission of complex, nuanced information, often involving multiple cues or types of feedback.