Iaukea Company makes two products from a common input. Joint processing costs up to the split-off point total $48,600 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below:
|
Product X |
Product Y |
Total |
| Allocated joint processing costs |
$ |
18,800 |
$ |
29,800 |
$ |
48,600 |
| Sales value at split-off point |
$ |
25,850 |
$ |
37,800 |
$ |
63,650 |
| Costs of further processing |
$ |
23,300 |
$ |
17,600 |
$ |
40,900 |
| Sales value after further processing |
$ |
48,800 |
$ |
56,500 |
$ |
105,300 |
|