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Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $335,000 per
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $335,000 per quarter. For financial reporting purposes, 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: Selling Price Product Quarterly Output A $ 17.00 per pound 12,400 pounds B $ 11.00 per pound 19,400 pounds C $23.00 per gallon 3,600 gallons 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: Additional Processing Costs Product A B $ 63,720 $91,120 C $ 37,360 Required: Selling Price $ 21.80 per pound $ 16.80 per pound $ 30.80 per gallon 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? 2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? (Enter "disadvantages" as a negative value.) Financial advantage (disadvantage) of further processing Required Product A Product B Product C Required 2 > Dorsey Company manufactures three products from a common input in a joint processing split-off point total $335,000 per quarter. For financial reporting purposes, 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 A B C Selling Price $17.00 per pound $11.00 per pound $ 23.00 per gallon Quarterly Output 12,400 pounds 19,400 pounds 3,600 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilit. The additional processing costs (per quarter) and unit selling prices after further processing are given below: Product A CBC C Required: Additional Processing Costs $ 63,720 $91,120 $ 37,360 Selling Price $ 21.80 per pound $ 16.80 per pound $30.80 per gallon 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? 2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further? Sell at split-off point? Process further? Product A Product B Product C
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