Exercise 10-7 Sell or Process Further [LO10-71 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: Quarterly Selling Price Product Output 5 per pound 12,000 pounds 5 per pound 17,000 pounds 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: Additional Product Processing Costs Selling Price 37,000 7 per pound 36,000 9 per pound 11,000 11 per gallon Required a. Compute the incremental profit (loss) for each product. Product B Product C Product A 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