Reference no: EM132571679

Question - Sebastian Manufacturing Limited produces three products from a single output. Joint processing costs up to the split off point total $200,000. The company allocates these costs based on the sales values at the split off point which are:

Product D $75,000

Product K $150,000

Product M $250,000

Each product can be processed further after the split off point and the following are the costs and sales if they are processed further:

	Additional Processing costs	Sales value after further processing
Product D	$55,000	$140,000
Product K	30,000	225,000
Product M	50,000	290,000

Required - Which products should be sold at the split off point and which should be processed further? Explain your answer and show your work.