Relevance of joint costs for decision
The managers of firm ST are facing a decision to further process product J2 before sale. J2 is one of three joint products provided by a manufacturing process. Product J2 presently is sold immediately after split-off. However, product J2 can be processed further and sold for a higher price. The overall volume of activity is not expected to change. Are the joint costs allocated to product J2 relevant for this decision? Explain your answer.
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