Figure 6-11
Information about three joint products follows: $\begin{array}{lccc}
&\text {X}&\text {Y}&\text {Z}\
\text { Anticipated production } & 12,000 \mathrm{kgs} . & 8,000 \mathrm{kgs} . & 7,000 \mathrm{kgs} . \
\text { Selling price } / \mathrm{kg} . \text { at split-off }& £ 16 & £ 26 & £ 48 \
\text { Additional processing costs } / \mathrm{kg} .
\

\text { after split-off (all variable) } & £ 8 & £ 20 & £ 20\
\text { Selling price } / \mathrm{kg} . \text { after further } \
\text { processing }&£20&£40&£70
\

\end{array}$
The cost of the joint process is £140,000.
-Refer to Figure 6-11. Which of the joint products should be processed further?
A)X
B)Y
C)Z
D)both X and Y

Question

Figure 6-11
Information about three joint products follows: $\begin{array}{lccc}
&\text {X}&\text {Y}&\text {Z}\
\text { Anticipated production } & 12,000 \mathrm{kgs} . & 8,000 \mathrm{kgs} . & 7,000 \mathrm{kgs} . \
\text { Selling price } / \mathrm{kg} . \text { at split-off }& £ 16 & £ 26 & £ 48  \
\text { Additional processing costs } / \mathrm{kg} .
\

\text { after split-off (all variable) } & £ 8 & £ 20 & £ 20\
\text { Selling price } / \mathrm{kg} . \text { after further } \
\text { processing }&£20&£40&£70
  \

\end{array}$
 The cost of the joint process is £140,000.
-Refer to Figure 6-11. Which of the joint products should be processed further?
A)X
B)Y
C)Z
D)both X and Y

Quizplus · Accepted Answer

Z should be processed further because it has the highest contribution margin per kg after further processing (£70 - £20 = £50) compared to X (£20 - £8 = £12) and Y (£40 - £20 = £20).

Figure 6-11 Information About Three Joint Products Follows The Cost of the Joint Process Is £140,000

Figure 6-11
Information About Three Joint Products Follows The Cost of the Joint Process Is £140,000