Georgia Orchards produced a good crop of peaches this year. After preparing the following income statement, the company believes it should have given its No. 3 peaches to charity and saved its efforts.

GEORGIA ORCHARDS Income Statement For Year Ended December 31, 2015 No. 1 No. 2 No. 3 Combined Sales (by grade) No. 1: 204,000 lbs.@ $2.30lb No. 2: 204,000 Ibs.@ $1.70/lb No. 3: 1,020,000 lbs. @ $0.20/lb Total sales $469,200 $346,800 204,000 $1,020,000 Costs Tree pruning and care $0.40/lb Picking, sorting, and grading $0.10/lb Delivery costs 81,600 20,400 15,800 81,600 20,400 15,800 408,000 102,000 38,300 571,200 142,800 69,900 Total costs 117,800 117,800 548,300 783,900 Net income (loss) $351,400 $229,000 $ (344,300) $ 236,100 In preparing this statement, the company allocated joint costs among the grades on a physical basis as an equal amount per pound. The company's delivery cost records show that $31,600 of the $69,900 relates to crating the No. 1 and No. 2 peaches and hauling them to the buyer. The remaining $38,300 of delivery costs is for crating the No. 3 peaches and hauling them to the cannery