Naperville Corporation Has a Joint Process That Produces Three Products

question 27

Multiple Choice

Naperville Corporation has a joint process that produces three products: P,G and A.Each product may be sold at split-off or processed further and then sold.Joint-processing costs for a year amount to $25,000.The production level for each product is 10,000 units.Other data follows:
$\begin{array}{llll}&\text { Sales Value }&\text {Separable Processing }&\text {Sales Value }\\ \text {Product }&\text {at Split-Off}&\text {Costs after Split-Off }&\text { at Completion}\\P &\$ 12 & \$ 8 & \$ 21 \\G&10 & 4 & 17 \\A&15 & 6 & 19\end{array}$
Processing Product P beyond the split-off point will cause profits to ________.

• A) be unchanged
• B) increase by $10,000
• C) increase by $80,000
• D) increase by $90,000

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