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Center Company currently produces three products from a joint process. The joint process has total costs of $505,000 per month. All three products, A, B
Center Company currently produces three products from a joint process. The joint process has total costs of $505,000 per month. All three products, A, B & C, are immediately saleable as they come out of the joint process. Alternatively, any of the products could continue on with additional processing and be sold as a more complete product. The following information is available:
Units | Immediate Sales Price | Later Sales Price | Unit Cost of Further Processing | |||||||||||
A | 4,300 | $ | 18 | $ | 19 | $ | 2.00 | |||||||
B | 17,800 | $ | 21 | $ | 23 | $ | 1.50 | |||||||
C | 10,300 | $ | 27 | $ | 32 | $ | 3.00 | |||||||
a-1. Should Product A be sold Immediately or sold after processing further? Sell Now Sell Later a-2. How much will the decision affect profit? Decision affects profit by b-1. Should Product B be sold immediately or sold after processing further? Sell Now . Sell Later b-2. How much will the decision affect profit? Decision affects profit by Sell Now Sell Later C-1. Should Product C be sold Immediately or sold after processing further? Sell Now Sell Later C-2. How much will the decision affect profit? Decision affects profit by
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