Georgia Pacific purchases logs from Cal Christian Timber Farm and processes the logs into three types of lumber products: - Studs for residential buildings (walls, ceilings) - Decorative pieces (fireplace mantels, beams for cathedral ceilings) - Posts used as support braces (mine support braces, braces for exterior fences on ranch properties) These products are the result of a joint sawmill process that involves removal of bark from the logs, cutting the logs into a workable size (ranging from 8 to 16 feet in length), and then cutting the individual products from the logs. The joint process results in the following costs of products for a typical month: - Direct materials, rough timber logs: $480,000 - Debarking, labor and overhgad: $50,000 - Sizing, labor and overhead: $220,000 - Product cutting, labor and overhead: $260,000 - Total joint costs: $1,010,000 Product yields and average sales values on a per-unit basis from the joint process are as follows: The studs are sold as rough-cut lumber after emerging from the sawmill operation without further processing by Georgia Pacific. Also, the posts require no further processing beyond the splitoff point. The decorative pieces must be planed and further sized after emerging from the sawmill. These additional processing costs are $90,000 per month and normally results in a loss of 10% of the units entering the process. Without this planning and sizing process, there is still an active intermediate market for the unfinished decorative pieces in which the selling price averages $55 per unit. Required (You must show your calculations) 1. Based on the information given for Liverpool Sawmill, allocate the joint processing costs of $1,010,000 to the three products using: 1. a. Sales value at splitoff method 2. b. Physical-measure method (volume in units) 3. c. NRV method 2. Prepare an analysis for Liverpool Sawmill that compares processing the decorative pieces further, as it currently does, with selling them as a rough-cut product immediately at splitoff and show the additional profit or loss from processing further