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A company uses a joint process to manufacture two products, Aces and Cones. One of...

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Accounting

A company uses a joint process to manufacture two products, Aces and Cones. One of the products, Cones, can be sold at the split-off point or processed further into Super Cones. Management has collected the following data about the products:

  1. the joint costs incurred to produce Aces and Cones.
  2. the per unit selling price of Cones.
  3. the total costs of processing Cones into Super Cones.
  4. the per unit selling price of Super Cones.

Which of the above are relevant to the decision of whether to sell Cones at the split-off point or to process them further into Super Cones?

a.

I, III and IV.
b.

I, II, III and IV.
c.

II and IV only.
d.

II, III and IV.

When a company wants to maximize profits while working under a constraint, it should focus on the products with the highest:

a.

selling price per unit.
b.

contribution margin per unit.
c.

selling price per unit of constrained resource.
d.

contribution margin per unit of constrained resource.

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