Download the Applying Excel form and enter formulas in all cells that contain question marks.

For example, in cell B26 enter the formula "=B5".

Verify that your worksheet matches the example in the text.

Check your worksheet by changing the cost of further processing coarse wool in cell B12 to $30,000. The overall profit from processing all intermediate products into final products should now be $150,000 and the profit from further processing coarse wool should now be $10,000. If you do not get these answers, find the errors in your worksheet and correct them.

You will use this worksheet to answer the questions in Part 2.

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:

1 Chapter 07: Applying Excel 3 Data 4 Exhibit 07-7 Santa Maria Wool Cooperative 5 Cost of wool 6 Cost of separation process 7 Sales value of intermediate products at split-off point 8 Undyed coarse wool 9 Undved fine wool 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products 12 Undyed coarse wool 13 Undved fine wool 14 Undved superfine wool 15 S 16 Dyed coarse wool 17 Dved fine wool 18 Dyed superfine wool 19 20 Enter a formula into each of the cells marked with a? below 21 Example: Joint Product Costs and the Contribution Approach $200,000 $40,000 $120,000 $150,000 $60,000 $50,000 $60,000 $10,000 ales value of end products $160,000 $240,000 $90,000 23 Analysis of the profitability of the overall operation 24 Combined final sales value 25 Less costs of producing the end products 26 Cost of wool 27 Cost of separation process 28 Combined costs of dyeing 29 Profit 30 31 Analysis of sell or process further: 32 Coarse Wool Fine Wool Superfine Wool 34 Final sales value after further processing 35 Less sales value at the split-off point 36 Incremental revenue from further processing 37 Less cost of further processing (dyeing) 38 Profit (loss) from further processing Chapter 07: Applying Excel 3 Data 4 Exhibit 7-6 Santa Maria Wool Cooperative 5 Cost of wool 6 Cost of separation process 7 Sales value of intermediate products at split-off point: 8 Undyed coarse wool 9 Undyed fine wool 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products 12 Undyed coarse wool 13 Undyed fine wool 14 Undyed superfine wool 15 Sales value of end products 16 Dyed coarse wool 17 Dyed fine wool 18 Dyed superfine wool $154,000 540,000 $132,000 $165,000 $55,000 $50,000 $60,000 $10,000 $149,000 $213,000 597.000 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? erall profit from processing all intermediate roducts b. What is the residual income? from further proce ssing undyed coarse wool from further processing undyed fine wool from further processing undyed superfine wool C-1. With these new costs and selling prices, what recommendations would you make concerning the company's operations? Sell as is or process further the intermediate product undyed coarse wool? Sell as is or process further the intermediate product undyed fine wool? Sell as is or process further the intermediate product undyed superfine wool? C-2. If your recommendation in part (C-1) is followed, what would be the company's overall profit? Overall profit from following the plan in part (c-1) 1 Chapter 07: Applying Excel 3 Data 4 Exhibit 07-7 Santa Maria Wool Cooperative 5 Cost of wool 6 Cost of separation process 7 Sales value of intermediate products at split-off point 8 Undyed coarse wool 9 Undved fine wool 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products 12 Undyed coarse wool 13 Undved fine wool 14 Undved superfine wool 15 S 16 Dyed coarse wool 17 Dved fine wool 18 Dyed superfine wool 19 20 Enter a formula into each of the cells marked with a? below 21 Example: Joint Product Costs and the Contribution Approach $200,000 $40,000 $120,000 $150,000 $60,000 $50,000 $60,000 $10,000 ales value of end products $160,000 $240,000 $90,000 23 Analysis of the profitability of the overall operation 24 Combined final sales value 25 Less costs of producing the end products 26 Cost of wool 27 Cost of separation process 28 Combined costs of dyeing 29 Profit 30 31 Analysis of sell or process further: 32 Coarse Wool Fine Wool Superfine Wool 34 Final sales value after further processing 35 Less sales value at the split-off point 36 Incremental revenue from further processing 37 Less cost of further processing (dyeing) 38 Profit (loss) from further processing Chapter 07: Applying Excel 3 Data 4 Exhibit 7-6 Santa Maria Wool Cooperative 5 Cost of wool 6 Cost of separation process 7 Sales value of intermediate products at split-off point: 8 Undyed coarse wool 9 Undyed fine wool 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products 12 Undyed coarse wool 13 Undyed fine wool 14 Undyed superfine wool 15 Sales value of end products 16 Dyed coarse wool 17 Dyed fine wool 18 Dyed superfine wool $154,000 540,000 $132,000 $165,000 $55,000 $50,000 $60,000 $10,000 $149,000 $213,000 597.000 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? erall profit from processing all intermediate roducts b. What is the residual income? from further proce ssing undyed coarse wool from further processing undyed fine wool from further processing undyed superfine wool C-1. With these new costs and selling prices, what recommendations would you make concerning the company's operations? Sell as is or process further the intermediate product undyed coarse wool? Sell as is or process further the intermediate product undyed fine wool? Sell as is or process further the intermediate product undyed superfine wool? C-2. If your recommendation in part (C-1) is followed, what would be the company's overall profit? Overall profit from following the plan in part (c-1)