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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 $345,000 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 A Selling Price $ 19.00 per pound B$ 13.00 per pound C $ 25.00 per gallon 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 C Additional Processing Costs Quarterly Output 12,800 pounds 20,000 pounds 4,000 gallons $ 68,500 $ 90,250 $ 41,600 Selling Price $ 24.00 per pound $19.00 per pound $ 33.00 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.

Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $345,000 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 A Selling Price $ 19.00 per pound B$ 13.00 per pound C $ 25.00 per gallon 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 C Additional Processing Costs Quarterly Output 12,800 pounds 20,000 pounds 4,000 gallons $ 68,500 $ 90,250 $ 41,600 Selling Price $ 24.00 per pound $19.00 per pound $ 33.00 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.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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? Note: Do not round your intermediate calculations. Enter "disadvantages" as a negative value. + Product A Product B Financial advantage (disadvantage) of further processing Required 1 Complete this question by entering your answers in the tabs below. Required 2 < Required 1 Sell at split-off point? Process further? Product A 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? Required 2 > Product B Product C <Required 1 Product C Required 2 >
Transcribed Image Text: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? Note: Do not round your intermediate calculations. Enter "disadvantages" as a negative value. + Product A Product B Financial advantage (disadvantage) of further processing Required 1 Complete this question by entering your answers in the tabs below. Required 2 < Required 1 Sell at split-off point? Process further? Product A 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? Required 2 > Product B Product C <Required 1 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 $345,000 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 A B с Selling Price $ 19.00 per pound $13.00 per pound $25.00 per gallon Product A D C 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: Quarterly Output 12,800 pounds 20,000 pounds 4,000 gallons Additional Processing Costs $ 68,500 $ 98,250 $ 41,600 Selling Price $ 24.00 per pound $ 19.00 per pound i $ 33.00 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.
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 $345,000 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 A B с Selling Price $ 19.00 per pound $13.00 per pound $25.00 per gallon Product A D C 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: Quarterly Output 12,800 pounds 20,000 pounds 4,000 gallons Additional Processing Costs $ 68,500 $ 98,250 $ 41,600 Selling Price $ 24.00 per pound $ 19.00 per pound i $ 33.00 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.
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