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What financial factors should management consider when deciding whether to sell a product at the split off point or process it further? As you think about this problem, think about the following factors:

1. Variable costs BEFORE and AFTER the split off point

2. Fixed costs BEFORE and AFTER the split off point

3. Total sell price AT and AFTER the split off point

4. What if the contribution margin is NEGATIVE AT the split off point?

Accounting Basics, Accounting

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