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Solved: Dorsey Company Manufactures Three Products From A Common Input In A Joint Processing Operation. Joint Processing Costs Up To The Split-off Point Total $315,000 Per Quarter. For Financial Repor

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Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to


Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $315,000 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 Selling Price Product $13.00 Per pound 11,600 pounds A $ 7,00 Per pound B 18,200 pounds $19.00 Per gallon C 2,800 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 Processing Costs Selling Price Product $17.40 Per pound A $54,640 $12.40 Per pound B $77,580 $26.40 Per gallon C $29,360 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? Complete this question by entering your answers in the tabs below. Required Required 1 2 Based on your analysis in requirement 1, which product or products sitould be sold at the split-off point and which product or products should be processed further? Product A Product Product C Sell at split-off point? Process further? <Required 1 Required 2

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Incremental analysis A B C Selling price after further processing 17.4 12.4 26.4

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