Chapter 13: Applying Excel: Exercise (Part 2 of 2) (Algo)

2. In industries that process joint products, the costs of the raw materials inputs and the sales values of intermediate and final products are often volatile. Change the data area of your worksheet to match the following:

If your formulas are correct, you should get the correct answers to the following questions.

a. What is the overall profit if all intermediate products are processed into final products?

b. What is the financial advantage (disadvantage) from further processing?

c-1. With these new costs and selling prices, what recommendations would you make concerning the companys operations?

c-2. If your recommendation in part (c-1) is followed, what would be the companys overall profit?

A B 1 1 Chapter 13: Applying Excel N $ 151,000 40,000 6. $ 8 $ EGA $ $ 124,000 160,000 58,000 CA 3 Data 4 Exhibit 13-7 Santa Maria Wool Cooperative 5 Cost of wool Cost of separation process 7 Sales value of intermediate products at split-off point: Undyed coarse wool Undyed fine wool 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products: Undyed coarse wool Undyed fine wool Undyed superfine wool 15 Sales value of end products: Dyed coarse wool 17 Dyed fine wool Dyed superfine wool 12 $ $ 13 $ 50,000 60,000 10,000 14 $ 16 $ 166,000 214,000 92,000 18 $