Two Products, QI and VH, Emerge from a Joint Process

question 397

Multiple Choice

Two products, QI and VH, emerge from a joint process. Product QI has been allocated $9,600 of the total joint costs of $12,000. A total of 9,000 units of product QI are produced from the joint process. Product QI can be sold at the split-off point for $13 per unit, or it can be processed further for an additional total cost of $54,000 and then sold for $18 per unit. If product QI is processed further and sold, what would be the financial advantage (disadvantage) for the company compared with sale in its unprocessed form directly after the split-off point?

• A) ($18,600)
• B) $108,000
• C) $600
• D) ($9,000)

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Definitions:

Job Restructuring

The process of modifying job roles and responsibilities, often to improve productivity, satisfaction, or accommodate workers' needs.

Scientific Management

A management theory that examines and integrates work processes to enhance economic effectiveness and particularly boost labor productivity.

Geographic Region

A specific area defined by physical location, cultural identity, or administrative boundaries.

Motivator-Hygiene Theory

A theory proposed by Frederick Herzberg that suggests job satisfaction and dissatisfaction arise from two different sets of factors - motivation factors and hygiene factors.