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Kelp Company produces three joint products from seaweed. At the split-off point, three basic products emerge: Sea Tea, Sea Paste, and Sea Powder. Each of
Kelp Company produces three joint products from seaweed. At the split-off point, three basic products emerge: Sea Tea, Sea Paste, and Sea Powder. Each of these products can either be sold at the split-off point or be processed further. If they are processed further, the resulting products can be sold as delicacies to health food stores. Cost and revenue information is as follows: Instructions a-1. Compute the incremental benefit (cost) of further processing to these products. (Negative amounts should be shown with a minus sign.) a-2. Which products should Kelp process beyond the split-off point? Sea tea and sea paste Sea tea and sea powder Sea paste and sea powder b. At what price per pound would it be advantageous for Kelp Company to sell Sea Paste at the split-off point rather than process it further? (Round your intermediate calculations and final answer to 2 decimal places.)
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