Faustina Chemical Corporation manufactures three chemicals (TX14, NJ35, and KS63) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows: For which product(s) above would it be more profitable for Faustina to sell at the split-off point rather than process further?

Question

Faustina Chemical Corporation manufactures three chemicals (TX14, NJ35, and KS63) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows:  For which product(s) above would it be more profitable for Faustina to sell at the split-off point rather than process further?

Quizplus · Accepted Answer

11eacbfc_c63b_1899_8ffe_85acfc8300c1_TB7552_00 NJ35 and KS63 should be processed further, but TX14 should be sold at the split-off point.

Faustina Chemical Corporation Manufactures Three Chemicals (TX14, NJ35, and KS63)