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Soren Company Makes Two Products from a Joint Input That

Question 108

Multiple Choice

Soren Company makes two products from a joint input that have the following information:  Sales Value Total Additional Sales Value  Units  Per Unit  Processing  Per Unit After  Produced At Split-Off  Costs Additional Processing  Product A 40,000$10$400,000$15 Product B 150,0004300,0007\begin{array}{rrrrr}&&\text { Sales Value }&\text {Total Additional}&\text { Sales Value }\\&\text { Units } & \text { Per Unit } & \text { Processing } & \text { Per Unit After }\\&\text { Produced} & \text { At Split-Off }& \text { Costs} & \text { Additional Processing }\\\hline\text { Product A } & 40,000 & \$ 10 & \$ 400,000 & \$ 15 \\\text { Product B } & 150,000 & 4 & 300,000 & 7\end{array} The joint cost incurred to produce the two products to the split-off point is $600,000.Which product(s) should be processed further?


A) A
B) B
C) Neither A nor B
D) Both A and B

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