Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $91,000 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 $91,000 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: Selling Price Quarterly Output A $ 4 per pound 13,000 pounds $ 5 per pound 18,000 pounds $ 8 per gallon 8.000 gallons Product 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 Processing Costs S 43.000 S 36,000 S 13,250 B Selling Price $ 6 per pound $ 9 per pound $ 10 per gallon Required: a. Compute the incremental profit (loss) for each product. Product A Product B Product C 0 0 0 Selling price after further processing Selling price at the split-off point Incremental revenue per pound or gallon Total quarterly output in pounds or gallons Total incremental revenue Total incremental processing costs Total incremental profit or loss 0 0 $ os 0 S
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started