Calculating the unit production cost

Reference no: EM131816738

Question: Joint Products, Multiple Choice From a particular joint process, Demoulas company produces three products, A, B, and C. Each product may be sold at the point of split-off or processed further. Additional processing requires no special facilities, and production costs of further processing are entirely variable and traceable to the products involved. In 2012, all three products were processed beyond split-off. Joint production costs for the year were $100,000. Sales values and costs needed to evaluate Demoulas's 2012 production policy follow:

Answer the following multiple-choice questions:

1. For units of C, the unit production cost most relevant to a sell-or-process-further decision is

(a) $1,

(b) $9,

(d) $3.

2. To maximize profits, Demoulas should subject the following product(s) to additional processing:

(a) C only,

(b) B and C only

(d) A only.

Reference no: EM131816738

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