Stahl Inc. produces three separate products from a common process costing $100,0
ID: 2485957 • Letter: S
Question
Stahl Inc. produces three separate products from a common process costing $100,014. Each of the products can be sold at the split-off point or can be processed further and then sold for a higher price. Shown below are cost and selling price data for a recent period.
215,858
Determine total net income if all products are sold at the split-off point.
Determine total net income if all products are sold at the split-off point.
Calculate incremental profit/(loss) and determine which products should be sold at the split-off point and which should be processed further. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Determine total net income using the results from previous part.
Is the net income different from that determined in part (b)?
Split-Off Point Cost to
Process Further Sales Value after
Further Processing Product 10 $59,852 $100,561 $190,605 Product 12 15,670 30,236 35,025 Product 14 54,701 149,304
215,858
Explanation / Answer
Answer:(a) Determine the total net income if all products are sold at the split-off point.
59852 + 15,670 + 54,701 - 100,014 = $30,209 net income
Answer:(b) Determine total net income if all products are sold after further processing.
190,605 + 35,025 + 215,858 - 100,014 - 100,561 - 30,236 - 149,304 = $61,373 net income
Answer:(c) incremental profit/(loss) and determine which products should be sold at the split-off point and which should be processed further.
Product 10= 190,605 - 100,561 - 59,852 = $30,192 gain, should
Product 12 = 35,025 - 30,236 - 15,670 = ($10,881) loss, shouldn't
Product 14 = 215,858 -149,304 - 54,701 = $11,853 gain, should
Answer:(d) 190,605 + 15,670 + 215,858 - 100,014 - 100,561 - 149,304 = $72,254 net income
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.