Dock Corporation Makes Two Products from a Common Input

Multiple Choice

Dock Corporation makes two products from a common input. Joint processing costs up to the split-off point total $33,600 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below: What is the minimum amount the company should accept for Product X if it is to be sold at the split-off point?

A) $31,800
B) $20,500
C) $16,800
D) $35,500