Question
Edmonton Chemical Company manufactures two industrial chemical products in a joint process. In May, 20,000 gallons of input costing $65,000 were processed at a cost
Edmonton Chemical Company manufactures two industrial chemical products in a joint process. In May, 20,000 gallons of input costing $65,000 were processed at a cost of $160,000. The joint process resulted in 15,000 pounds of Resoline and 5,000 pounds of Krypto. Resoline sells for $20 per pound, and Krypto sells for $40 per pound. Management generally processes each of these chemicals further in separable processes to produce more refined chemical products. Resoline is processed separately at a cost of $6 per pound. The resulting product, Resolite, sells for $32 per pound. Krypto is processed separately at a cost of $10 per pound. The resulting product, Kryptite, sells for $62 per pound. |
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