Problem
IPS operates a factory which produces the MiniY and the MiniX. During September 20X8, the factory produced 500 units of MiniY and 600 units of MiniX. The joint cost related to the operation was $3,000,000. MiniX sells for $3,500 per unit and MiniY sells for $3,800 per unit. Allocate the joint costs (production cost allocation) using the relative sales values of MiniY and MiniX. You hope you can prove that the MiniX is profitable, but you also recognize that numbers don't lie!
With the costs that you calculate, what is the profit or loss associated with MiniX?