|newconnect.mheducation.com/flow/connect.html mework Exercise 12-13 Sell or Proc

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|newconnect.mheducation.com/flow/connect.html mework Exercise 12-13 Sell or Process Further Decision [LO12-7) products from processing 1 ton of clypton, a rare mineral. Material and processing costs total $54,000 ndred units of product X15 are produced from each ton per ton, one-fourth of which is allocated to product X15. Six thousand three hu of clypton. The units can either for $20 each. be sold at the split-off point for $17 each, or processed further at a total cost of $8,700 and then sold Required . What is the financial advantage (disadvantage) of further processing product X15? 2. Should product X15 be processed further or sold at the split-off point? be here to search

Explanation / Answer

1 Sales value if processed further 126000 Sales value at the split-off point 107100 Incremental revenue 18900 Less cost of processing further 8700 Net advantage of processing further 10200 2 Product X15 Should be processed further

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