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ZWYWIJ448 corporation manufactures three products from a joint process. The three products are in industrial grade form at the spilt-off point. They can either be

ZWYWIJ448 corporation manufactures three products from a joint process. The three products are in industrial grade form at the spilt-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this process is as follows:

Product 1 Product 2 Product 3
Sales Price at spilt-off point $16 $12 $5
Allocated joint costs $6,000 $6,000 $6,000
Sales Price after further processing $20 $18 $14
Cost of further processing $6,340 $3,110 $1,520

Product Quantity

1,000 lb. 1,000 lb. 1,000 lb.

What would be the additional amount of profit that ZWYWIJ448 Corp. would gain form further processing the product(s) that is/are more profitable to process further rather than be sold at the spilt-off point ?

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