(a) Angus Menzies and Company is investigating the possibility of using a standard costing system for the process. The standards are to be based on the following information:

The joint process optimally requires equal quantities of A and B. The normal output from an input of 500 litres of A and 500 litres of B is:

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500 litres of C, 250 litres of D and 250 litres of waste. The waste has a saleable value of 5p per litre. The purchasing department considers that the normal raw material prices are: 0.66 per litre for A and 0.33 per litre for B.