Company has a joint process, which produces three products called A, B and C. Each product may be sold at split-off or processed further and then sold. Joint processing costs for a year are $20,000. Other relevant data are:
Product Sales Value at split-off Separable Processing Costs After Split-Off Sales Value atCompletion
A $94,000 $28,000 $115,000
B 60,000 10,000 82,000
C 66,000 14,000 79,000
A) Which products should be processed further? Why?
B) If the Sealy Company maximizes profits, what is the operating income?