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Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $380,000 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: Product Selling Price Quarterly Output A $ 26.00 per pound 14,200 pounds B $ 20.00 per pound 22,100 pounds C $ 32.00 per gallon 5,400 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: Product Additional Processing Costs $ 86,490 Selling Price $ 31.70 per pound $ 26.70 per pound A B $ 125,095 C $ 57,700 $ 40.70 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? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? (Do not round your intermediate calculations. Enter "disadvantages" as a negative value.) Financial advantage (disadvantage) of further processing Required 1 Product A Product B Product C Required 2 <

Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $380,000 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: Product Selling Price Quarterly Output A $ 26.00 per pound 14,200 pounds B $ 20.00 per pound 22,100 pounds C $ 32.00 per gallon 5,400 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: Product Additional Processing Costs $ 86,490 Selling Price $ 31.70 per pound $ 26.70 per pound A B $ 125,095 C $ 57,700 $ 40.70 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? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? (Do not round your intermediate calculations. Enter "disadvantages" as a negative value.) Financial advantage (disadvantage) of further processing Required 1 Product A Product B Product C Required 2 <

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter25: 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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Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $380,000 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: Product Selling Price Quarterly Output A $ 26.00 per pound 14,200 pounds B $ 20.00 per pound 22,100 pounds C $ 32.00 per gallon 5,400 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: Product Additional Processing Costs $ 86,490 Selling Price $ 31.70 per pound $ 26.70 per pound A B $ 125,095 C $ 57,700 $ 40.70 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? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? (Do not round your intermediate calculations. Enter "disadvantages" as a negative value.) Financial advantage (disadvantage) of further processing Required 1 Product A Product B Product C Required 2 <
Transcribed Image Text:Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $380,000 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: Product Selling Price Quarterly Output A $ 26.00 per pound 14,200 pounds B $ 20.00 per pound 22,100 pounds C $ 32.00 per gallon 5,400 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: Product Additional Processing Costs $ 86,490 Selling Price $ 31.70 per pound $ 26.70 per pound A B $ 125,095 C $ 57,700 $ 40.70 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? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? (Do not round your intermediate calculations. Enter "disadvantages" as a negative value.) Financial advantage (disadvantage) of further processing Required 1 Product A Product B Product C Required 2 <
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