Check m Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $300,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Selling Price Quarterly Output Product A $ 10.00 per pound 11,000 pounds B с $ 4.00 per pound 17,300 pounds $16.00 per gallon 2,200 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below. Additional Product Processing Costs A B C $48,250 $68,055 $23,780 Selling Price $14.10 per pound $ 9.10 per pound $23.10 per gallon Required: 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? 2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further?
Check m Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $300,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Selling Price Quarterly Output Product A $ 10.00 per pound 11,000 pounds B с $ 4.00 per pound 17,300 pounds $16.00 per gallon 2,200 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below. Additional Product Processing Costs A B C $48,250 $68,055 $23,780 Selling Price $14.10 per pound $ 9.10 per pound $23.10 per gallon Required: 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? 2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further?
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 4CMA: Oakes Inc. manufactured 40,000 gallons of Mononate and 60,000 gallons of Beracyl in a joint...
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![Check n
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the
split-off point total $300,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products on
the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows:
Quarterly
Output
Product
Selling Price
A
$ 10.00 per pound
11,000 pounds
B
$ 4.00 per pound
с
$16.00 per gallon.
17,300 pounds
2,200 gallons
Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional
processing costs (per quarter) and unit selling prices after further processing are given below:
Additional
Product Processing Costs
ABC
$48,250
$68,055
$23,780
Selling
Price
$14.10 per pound
$ 9.10 per pound
$23.10 per gallon
Required:
1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point?
2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or
products should be processed further?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe7ba4024-4c9d-4a53-bcd7-a8f05354fa45%2F701971bb-a06d-4ed9-b719-df0561bdc963%2Fdhtieh_processed.png&w=3840&q=75)
Transcribed Image Text:Check n
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the
split-off point total $300,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products on
the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows:
Quarterly
Output
Product
Selling Price
A
$ 10.00 per pound
11,000 pounds
B
$ 4.00 per pound
с
$16.00 per gallon.
17,300 pounds
2,200 gallons
Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional
processing costs (per quarter) and unit selling prices after further processing are given below:
Additional
Product Processing Costs
ABC
$48,250
$68,055
$23,780
Selling
Price
$14.10 per pound
$ 9.10 per pound
$23.10 per gallon
Required:
1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point?
2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or
products should be processed further?
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