A company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $98,000 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 $4 per pound 10,000pounds

B $6per pound 22,000pounds

C $12per gallon 5,000gallons

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 Selling Price

Processing Costs

A $53,000 $7per pound

B $38,000 $11per pound

C $18,000 $18per gallon

Which products should be processed further?

Multiple Choice

• A and B
• B and C
• A, B, and C
• A and C