Information About Three Joint Products Follows: the Cost of the Joint

question 50

Multiple Choice

Information about three joint products follows: The cost of the joint process is $140,000.Which of the joint products should be processed further?
$\begin{array}{l}&A&B&C\\\text { Anticipated production } & 12,000 \mathrm{~kg} & 8,000 \mathrm{~kg} & 7,000 \mathrm{~kg} \\\text { Selling price/kg at split-o ff } & \$ 16 & \$ 26 & \$ 48\\\text { Additional processing costs/kg after split-off }\\\text { (all variable) } & \$ 8 & \$ 20 & \$ 20 \\\text { Selling price/kg after further processing } & \$ 20 & \$ 40 & \$ 70\end{array}$

• A)joint product A
• B)joint product B
• C)joint product C
• D)all joint products

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Definitions:

Percentage Point

A percentage point is a unit for expressing differences in percentages, helping to clarify changes in percent values over time by denoting the absolute difference between them.

Standard and Poor's

A financial services company known for its stock market indices such as the S&P 500, as well as its rating services for bonds and other securities.

Stock Split

Issue by a corporation of a given number of shares in exchange for shares currently held by stockholders. A split increases the number of shares outstanding. A reverse split decreases the number outstanding.

Divisor

A number by which another number is to be divided.