Galtman Company produces three products from a common input: Galt-A, Galt-B, and Galt-C. The joint costs for a typical month are described below.

The revenues from each product are as follows: Galt-A, $43,000; Galt-B, $56,000; and Galt-C, $28,000.
Management is considering processing Galt-A beyond the split-off point, which would increase the Galt-A sales value to $76,000. However, to process Galt-A further means that the company must rent some special equipment costing $6,000 per month. Additional ma¬
terials and labor also needed would cost $4,500 per month.
Required:
1. What is the gross profit earned by the three products for one quarter?
2. Should the division process Galt-A further or sell it at split-off? What is the effect of the decision on monthly gross profit?

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Direct materials $42,000 Direct labor 20,000 Overhead 30,000