Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $355,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products based on 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 C Product Selling Price $ 21.00 per pound $15.00 per pound $ 27.00 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: D C Quarterly Output 13,200 pounds 20,600 pounds 4,400 gallons Additional Processing Costa $ 73,440 $ 105,620 $ 46,000 Selling Price $26.20 per pound $ 21.20 per pound t $35.20 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 cold at the
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $355,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products based on 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 C Product Selling Price $ 21.00 per pound $15.00 per pound $ 27.00 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: D C Quarterly Output 13,200 pounds 20,600 pounds 4,400 gallons Additional Processing Costa $ 73,440 $ 105,620 $ 46,000 Selling Price $26.20 per pound $ 21.20 per pound t $35.20 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 cold at the
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 10CE: A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each...
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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 $355,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products
based on 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
a
С
Selling Price
$ 21.00 per pound
$15.00 per pound
$27.00 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.
Additional
Processing
Costa
$ 73,440
Quarterly Output
13,200 pounds
20,600 pounds
4,400 gallons
$ 105,620
$ 46,000
Selling Price
$26.20 per pound
$ 21.20 per pound
$35.20 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 hould be cold at the coll](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7db1fb26-6cba-4eb4-89a8-a7287b63ad82%2Fce62d544-c76d-46e5-a5c0-4f768f6e517c%2Fx0bto4a_processed.png&w=3840&q=75)
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 $355,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products
based on 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
a
С
Selling Price
$ 21.00 per pound
$15.00 per pound
$27.00 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.
Additional
Processing
Costa
$ 73,440
Quarterly Output
13,200 pounds
20,600 pounds
4,400 gallons
$ 105,620
$ 46,000
Selling Price
$26.20 per pound
$ 21.20 per pound
$35.20 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 hould be cold at the coll
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