Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows: NY29 TX38 CA55 Sales value at split-off point P5,000 P16,000 P12,000 Allocated joint costs P6,000 P6,000 P6,000 Sales value after further processing P9,000 P20,000 P18,000 Cost of further processing P2,000 P5,000 P3,000 For which product(s) above would it be more profitable for Agao to sell at the split-off point rather than process further?

Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that...

Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows:

	NY29	TX38	CA55
Sales value at split-off point	P5,000	P16,000	P12,000
Allocated joint costs	P6,000	P6,000	P6,000
Sales value after further processing	P9,000	P20,000	P18,000
Cost of further processing	P2,000	P5,000	P3,000

For which product(s) above would it be more profitable for Agao to sell at the split-off point rather than process further?

Jun 10, 2022

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Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that...

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