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Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split off point total $336,000 per quarter. The company allocates these costs to the joint products on the basis of their relative sales value at the split off point. Unit selling prices and total output at the split off point are as follows: |
| Product | Selling Price | Quarterly Output |
| A | $16 per pound | 14,600 pounds |
| B | $7 per pound | 19,800 pounds |
| C | $27 per gallon | 2,300 gallons |
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Each product can be processed further after the split off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below: |
| Product | Additional Processing Costs |
Selling Price |
| A | $64,600 | $19 per pound |
| B | $80,000 | $15 per pound |
| C | $36,300 | $31 per gallon |
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rev: 02 12 2011
9. value:
2.00 points
| Required: | |
| (a) | Compute the incremental profit (loss) for each product. (Negative amounts should be indicated by a minus sign. Omit the “$” sign in your response.) |
| Product A | Product B | Product C | |
| Incremental profit (loss) | $ | $ | $ |
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rev: 02 12 2011 check my workeBook Linkreferences
10. value:
2.00 points
| (b) | Which product or products be sold at the split off point? ( by Solid Savings” href=”http://ezto.mhecloud.mcgraw hill.com/#” class=”c37″>Select all that apply.) |
by Solid Savings” href=”http://ezto.mhecloud.mcgraw hill.com/#” class=”c37″>
rev: 02 12 2011
| Product A | |
| Product B | |
| Product C |
eBook Linkreferences
11. value:
2.00 points
|
(c) |
Which product or products should be processed further? |
rev: 02 12 2011
| Product A | |
| Product B | |
| Product C |
check my workeBook Linkreferences
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