Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing...
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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 $395,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products or 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 $ 29.00 per pound 14,800 pounds B $ 23.00 per pound 23,000 pounds C $ 35.00 per gallon. 6,000 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 Costa $ 94,800 Product A B $ 137,500 $ 65,200 Selling Price $ 35.00 per pound $ 30.00 per pound C Required: $44.00 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.) Product A Product B Product C Financial advantage (disadvantage) of further processing Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $395,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products or 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 $ 29.00 per pound 14,800 pounds B $ 23.00 per pound 23,000 pounds C $ 35.00 per gallon. 6,000 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 Costa $ 94,800 Product A B $ 137,500 $ 65,200 Selling Price $ 35.00 per pound $ 30.00 per pound C Required: $44.00 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.) Product A Product B Product C Financial advantage (disadvantage) of further processing
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