sale or process further, basic analysis

Sell or Process Further, Bosic Analysis Carleigh, Inc., is a pork processor. Tts plants, located in the Midwest, produce several products from a common process: sirfoin roasts, chops, spare ribs, and the residual. The roasts, chops, and spare ribs are packaged, branded, and sold to stpermarkets. The residual consists of organ meats and leftover pieces that are sold to sausage and hot dog processors. The joint costs for a typical week are as follows: The revenues from each product are as follows: sirloin roasts; $76,500; chops, 581,500; spare ribs, $38,000; and residual, $8,400. Carieigh's manapement has learned that certain organ meats are a prized delicacy in Asia. They are considering separating those from the reaidual and selling them abroad for $49,800. This would bring the value of the residual down to $2,900, In addition, the organ meats would need to be packaged and then alr frelghted to Asia, Further processing cost per week is estimated to be $23,300 (the cont of renting additional packaging equipment, purchosing materials, and hiring additional direct labor). Transportation cost would be 310,900 per week, Finally, resource spending would need to be expanded for other activities as weil fpurchasing, recelving, and internal shipping). The increase lin resource spending for these activities is ontimated to be $3,050 per week- 1. What is the gross profit earned by the original mix of products for one week? 2. Should the company separate the organ meats for shipment overseas or continue to sell them at split-off? What is the effect of the decision on weekly gross profit? by 5