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Ralston Tile produces three types of ceramic tiles, models 45, 51, and 56 from clay,...

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Accounting

Ralston Tile produces three types of ceramic tiles, models 45, 51, and 56 from clay, which is mined in the Arizona desert. Budgeted data for next month follows:

45 51 56

Units produced 3,000 4,500 6,000

Sales value at split-off per unit $15 $18 $24

Additional processing costs per unit $6 $6 $7

Joint production costs per unit $2 $5 $5

Sales value if processed further per unit $20 $22 $32

The joint cost of mining the clay is $80,000. Which of the products should be produced beyond the split-off point?

Yes Yes Yes
Yes Yes No
No Yes Yes
No No Yes
Yes No No

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