Question: Kelp Company produces three joint products from seaweed. At the split-off point, three basic products emerge: Sea Tea, Sea Paste, and Sea Powder. Each of these products can either be sold at the split-off point or be processed further. If they are processed further, the resulting products can be sold as delicacies to health food stores. Cost and revenue information is as follows: Sales Value and Additional Costs if Produced Further Product Pounds Sales Final Additional Produced Value at Sales Cost Split-Off Value Sea Tea 9,000 $60,000 $90,000 $35,000 Sea 4,800 71,100 160,000 50,000 Paste Sea 2,000 70,000 85,000 14,000 Powder Compute the incremental benefit (cost) of further processing to these products.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

Please provide accurate answer with explanation

Question:
Kelp Company produces three joint products from seaweed. At
the split-off point, three basic products emerge: Sea Tea, Sea
Paste, and Sea Powder. Each of these products can either be sold
at the split-off point or be processed further. If they are
processed further, the resulting products can be sold as delicacies
to health food stores. Cost and revenue information is as follows:
Sales Value and Additional Costs if
Produced Further
Product Pounds Sales
Final
Additional
Produced
Value at Sales
Cost
Split-Off Value
Sea Tea 9,000
$60,000
$90,000
$35,000
Sea
4,800
71,100
160,000 50,000
Paste
Sea
2,000
70,000
85,000 14,000
Powder
Compute the incremental benefit (cost) of further processing to
these products.
Transcribed Image Text:Question: Kelp Company produces three joint products from seaweed. At the split-off point, three basic products emerge: Sea Tea, Sea Paste, and Sea Powder. Each of these products can either be sold at the split-off point or be processed further. If they are processed further, the resulting products can be sold as delicacies to health food stores. Cost and revenue information is as follows: Sales Value and Additional Costs if Produced Further Product Pounds Sales Final Additional Produced Value at Sales Cost Split-Off Value Sea Tea 9,000 $60,000 $90,000 $35,000 Sea 4,800 71,100 160,000 50,000 Paste Sea 2,000 70,000 85,000 14,000 Powder Compute the incremental benefit (cost) of further processing to these products.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education