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Uptown Corporation Has a Joint Process That Produces Three Products

Question 41

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Uptown Corporation has a joint process that produces three products: P,G and A.Each product may be sold at split-off or processed further and then sold.Joint-processing costs for a year amount to $20,000.Other data follows:
 Sales Value Separable Processing Sales Value Product at Split-OffCosts after Split-Off  at CompletionP$32,000$5,000$39,000G16,5007,50029,000A6,4008,00010,000\begin{array}{llll}&\text { Sales Value }&\text {Separable Processing }&\text {Sales Value }\\ \text {Product }&\text {at Split-Off}&\text {Costs after Split-Off }&\text { at Completion}\\P & \$ 32,000 & \$ 5,000 & \$ 39,000 \\G & 16,500 & 7,500 & 29,000 \\A & 6,400 & 8,000 & 10,000\end{array}
Processing Product P beyond the split-off point will cause profits to ________.


A) be unchanged
B) increase by $2,000
C) increase by $3,000
D) increase by $7,000

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