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Brookfield Corporation Has a Joint Process That Produces Three Products

Question 115

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Brookfield Corporation has a joint process that produces three products: X,Y and Z.Each product may be sold at split-off or processed further and then sold.Joint-processing costs for a year amount to $100,000.Other data follows:
 Sales Value Separable Processing Sales Value Product at Split-OffCosts after Split-Off  at CompletionX$128,000$16,000$150,000Y75,00026,00099,000Z32,60020,00050,000\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}\\X & \$ 128,000 & \$ 16,000 & \$ 150,000 \\Y & 75,000 & 26,000 & 99,000 \\Z & 32,600 & 20,000 & 50,000\end{array}
Processing Product X beyond the split-off point will cause profits to ________.


A) be unchanged
B) increase by $6,000
C) increase by $16,000
D) increase by $22,000

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