Reference no: EM131969611
Walman Corp. manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products on the basis of relative sales value at the split-off point. Additional information is as follows:
X Y Z Total
Units produced 14,000 10,000 6,000 30,000
Joint costs $204,000 $90,000 $66,000 $360,000
Sales value at split-off ? 150,000 110,000 600,000
Additional costs for
further processing 38,000 30,000 22,000 90,000
Sales value if
processed further 348,000 185,000 147,000 680,000
Based solely on a relevant cost analysis, which of the three products should be manufactured by Walman beyond the split-off point?