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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 $92,000 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 $92,000 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:

Product Selling Price Quarterly Output

A $ 3 per pound 20,000 pounds

B $ 4 per pound 25,000 pounds

C $ 9 per gallon 7,000 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:

Product Additional Processing Costs Selling Price

A $ 43,000 $ 4 per pound

B $ 37,000 $ 6 per pound

C $ 11,250 $ 11 per gallon

b.Which product or products should be processed further?

A,B,C OR ALL

Which product or products should be sold at the split-off point?

A,B,C OR ALL

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