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Prosner Corporation manufactures three products from a common input in a joint processing operation. ...

Prosner Corporation manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $500,000 per year. The company allocates these costs to the joint products on the basis of their total sales value at the split-off point.

Each product may be sold at the split-off point or processed further. The additional processing costs and sales value after further processing for each product (on an annual basis) are:

	Sales Value at Split-Off	Further Processing Costs	Sales Value After Further Processing
Product D	$ 300,000	$ 125,000	$ 534,000
Product F	$ 275,000	$ 210,000	$ 450,000
Product G	$ 195,000	$ 135,000	$ 360,000

Required:

Which product or products should be sold at the split-off point, and which product or products should be processed further?

Textbook

Introduction to Managerial Accounting: Brewer Edition: 9e

Edition: 9^th

Authors: Brewer, Garrison, Noreen

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