Computation of Breakeven Point for Joint Processes (J. March) The March-I Company processes soybeans to obtain oil, meal, and chaff. There are three processes. In the cleaning process, the chaff and foreign materials are separated from the beans. In the pressing process, soybean oil and soybean cake are produced. The oil is stored in tanks and later pumped into tank cars for ship- ment. In the grinding process, the soybean cake is dried and then ground into meal.

The standard yield from a ton (2,000 Ibs.) of beans is 100 pounds of chaff, 800 pounds of meal, and 100 gallons of oil. The following selling prices have been chosen for the purpose of calculations: beans delivered to plant, $120 a ton; chaff, $10 a ton; oil, $1.20 a gallon; and meal, $200 a ton. Budgeted costs of processing are:

VARIABLE COSTS FIXED COSTS PER UNIT PER MONTH Cleaning 10¢ per ton of beans $ 500 Pressing $2 per ton of cleaned beans 2,000 Grinding $2 per ton of meal 1,500 Assume that there are no work-in-process inventories and that selling and administrative expenses are: fixed costs of $1,800 monthly; variable costs of 10 percent of dollar sales in the case of oil sales and meal sales and zero in the case of chaff sales.
. Chart of physical flow.
. How many tons of beans must be processed monthly in order to break even?
Show computations clearly. lop1