Jasper Ridge Materials, Inc., receives silicon crystals that it processes into purified wafers and chips. Silicon crystals cost $30,000 per tank-car load. The process is such that the crystals are heated for 12 hours, at the end of which time there are 45,000 purified wafers, with a market value of $10,000, and 15,000 chips, with a market value of $70,000. The cost of the heat process is $12,800.

a. If the crystal costs and the heat process costs are to be allocated on the basis of units of output, what cost would be assigned to each product?

b. If the crystal costs and the heat process costs are allocated on the basis of the ine)

realizable value, what cost would be assigned to each product?

How much profit or loss does the purified waferj^roduct provide using the data in this problem and your analysis in requirement (a)? Is it really possible to determine which product is more profitable? Explain why or why not.