Boston Corporation Has a Joint Process That Produces Three Products

question 75

Multiple Choice

Boston Corporation has a joint process that produces three products: X,Y and Z.Each product may be sold at split-off or processed further and then sold.Joint-processing costs for a year amount to $100,000.Other data follows:
$\begin{array}{llll}&\text { Sales Value }&\text {Separable Processing }&\text {Sales Value }\\ \text {Product }&\text {at Split-Off}&\text {Costs after Split-Off }&\text { at Completion}\\X & \$ 128,000 & \$ 16,000 & \$ 160,000 \\Y & 50,000 & 25,000 & 77,000 \\Z & 25,600 & 20,000 & 40,000\end{array}$
Processing Product Y beyond the split-off point will cause profits to ________.

• A) be unchanged
• B) increase by $1,000
• C) increase by $2,000
• D) increase by $27,000

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Definitions:

Sampling Distribution

The distribution of chances related to a statistic that comes from drawing a significant number of samples from a particular group of people or items.

Sampling Distribution

Probabilistic distribution outcomes for a predetermined statistic, based on a sample chosen at random.

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Simple Random Sample

A portion of a statistical population where every member in that portion is equally likely to be selected.