Dorsey Company manufactures three products from a common input in a joint processing operation. 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 $335,000 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 12,400 pounds 19,400 pounds 3,600 gallons ProductSelling Price A 17.00 per pound B 11.00 per pound C 23.00 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: Selling Price Additional Product Processing Costs $63,720 $91,120 $37,360 $21.80 per pound $16.80 per pound $30.80 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
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