I am so confused on this problem. I was wondering it what I have is correct and

Question

I am so confused on this problem. I was wondering it what I have is correct and if not how do you do it?

rm Kirk Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint products: Spock, Uhura, and Suhu. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of $180,000 to process one batch of the raw material that produces the three joint products. The following cost and sales information is available for one batch of each product. Allocated Joint Costs $40,000 60,000 80,000 Cost to Process Further $110,000 85,000 250,000 Sales Value of Processed Product $300,000 400,000 800,000 Sales Value at Spock Uhura Suhu lit-off Point $210,000 300,000 455,000 Determine whether each of the three joint products should be sold as is, or processed further, Sales value of processed product Sales value split-off point Incremental revenue Incremental costs Incremental profit (loss) $300,000 210,000 $90,000 150,000 $20,000 Uhura $400,000 300,000 $100,000 145,000 $15,000 Suhu $800,000 455,000 $345,000 330,000 95,000

Explanation / Answer

Spock Uhura Suhu Sales revenue after further processing 300000 400000 800000 sales revenue at split off point 210000 300000 455000 Incremental sales revenue 90000 100000 345000 Incremental further processing cost 110000 85000 250000 Incremental profits /(Loss) -20000 15000 95000 Hence, Product Spock Sale at Split off point Product Uhura Sale after further processing Product Suhu Sale after further processing

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