Reference no: EM132663428

S Company produces 3 joint products XYZ from one input. The products can be sold at the split-off point or processed further. The joint production cost for the month, allocated among the products based on the relative physical volume of output are as follows:

Materials 150,000
Labor 30,000
Factory overhead 20,000
Total joint cost 200,000

Additional information about the three products are given in the following:

                                                                                               Unit Sales Price

Products         Production in units       At split off          If processed further             Additional Processing Cost
X                        5,000                      80                         100                               15
Y                        3,000                      45                              60                           20
Z                      2,000                        60                          75                                10

Problem 1: How much is the total gross profit if the company took the most profitable action with respect to the three products?