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The Western Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point. A, B, C, and D. Product
The Western Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point. A, B, C, and D. Product C is fully processed by the splitoff point. Products A, B, and D can individually be further refined into Super A, Super B, and Super D. In the most recent month (November), the output at the splitoff point was as follows: (1) (Click the icon to view the information.) Read the requirements. Requirement 2. Could Western Oil have increased its November operating income by making different decisions about the further processing of products A, B, or D ? Show the effect on operating income of any changes you recommend. Determine the formula you will use to make your decision. Then enter the amounts for each product and determine the effect on operating income of the decision. (Enter negative effects with parentheses or a minus sign.) More info - Product A, 250,000 gallons - Product B, 95,000 gallons - Product C, 45,000 gallons - Product D, 110,000 gallons The joint costs of purchasing and processing the crude vegetable oil were $40,000. Western had no beginning or ending inventories. Sales of product C in November were $60,000. Products A, B, and D were further refined and then sold. Data related to November follow: refined and then sold. Data related to November follow: Western had the option of selling products A, B, and D at the splitoff point. This alternative would have yielded the following revenues for the November production: - Product A, $40,000 - Product B, $30,000 - Product D, $70,000
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