WP Corporation produces products X, Y, and Z from a single raw material input in a joint production process. Budgeted data for the next month is as follows: Product X Product Y Product Z Units produced 1,600 2,100 3,100 Per unit sales value at split-off $ 14.00 $ 19.00 $ 16.00 Added processing costs per unit $ 5.00 $ 7.00 $ 7.00 Per unit sales value if processed further $ 20.00 $ 20.00 $ 25.00 The cost of the joint raw material input is $69,000. Which of the products should be processed beyond the split-off point? Product X Product Y Product Z A) yes yes no B) yes no yes C) no yes no D) no yes yes

B) yes no yes

Explanation:

The preparation is shown below:

ParticularsProduct XProduct YProduct Z

Units produced 1,600           2,100         3,100

Sales Value at split off per unit$14$19$16

Total Sales Value at split off   (a)$22,400$39,900$49,600

Units produced1,6002,1003,100    (X)

Sales Value per unit$20$20$25

Additional Processing cost per unit$5$7$7

Net Realizable Value = Sales value - Further costs$15$13$18 (y)

Total Realizable Value if processed further (b) $24,000$27,300$55,800   (x × Y)

Difference = b- a $1,600-$12,600          $6,200

Processed furtherYes            No               Yes

As the product X and product Z contains positive number so it should be processed and Product Y should not be processed as it contains negative number

answersupplies;