Managerial Accounting

In a joint production process costing $1,200,000, ARA INC. converts 15,000 meters of direct material into 4,000 meters of product A, 5,000 meters of product B, and by-product C. Standard shrinkage loss is 20%. By-product C is sold at $40 per meter. Product A and B are both processed after the split-off point at additional costs of $75 per meter for product A and $60 per meter for product B. The selling price of product A and B after further processing is $300 per meter and $200 per meter, respectively. ARA INC. allocates joint costs using the net realizable value (NRV) method. There is no stock of finished product a Compute profit (loss) earned on the sale of Product A. [If necessary, round your answer to the nearest integer. Use a minus sign to indicate a loss, e.g. -1000. Do not use spaces or thousands separators in your answers.] b Compute the change in ARA's INC. total profit (loss) if it switches to the physical measures method to allocate joint costs. [If necessary, round your answer to the nearest integer. Use a minus sign to indicate a negative change, e.g. -1000. Do not use spaces or thousands separators in your answers.]