ACCTG 231 Fall 2023

EXCEL PROBLEM # 4 JOINT PROCESSING

Below is information for Excel Problem #4. The information has also been input into the spreadsheet provided for you to submit your solution.

Excelsior Company manufactures three products in a joint process that costs $235,000. Initial processing results in the following number of units of each product:

Product A 2,700 units

Product B 1,600 units

Product C 2,100 units

At the initial split off point the products can be sold for the prices below:

Product A $47 per unit

Product B $40 per unit

Product C $35 per unit

Instead of selling the products at split off, Excelsior could spend an additional $55,000 to process Product A further, which would result in a new sales price for Product A of $70 per unit. Excelsior could also process Product B further at a cost of $70,000, which would result in a new sales price for Product B of $80 per unit and could process Product C further at a cost of (use the last five digits of your student ID for the cost of further processing Product C (53297)), resulting in a new sales price for Product C of $45 per unit.

The three tasks to complete in the spreadsheet are:

1. Complete the schedule provided to illustrate the financial advantage or disadvantage of further processing each of the products (be sure disadvantages appear as negative numbers). (3 points)

1. Based on your schedule in question #1, put an X in the relevant cell to indicate which product(s) should be sold at split-off and which processed further? (3 points)

1. Complete the schedule provided to compute the total profit earned if units are sold as indicated by your answer to question #2. (4 points)

Remaining 5 points are for having a working spreadsheet that recalculates if one of the given variables is changed.

Complete the chart below (example on page 535 of text) to illustrate the financial advantage or disadvantage of further processing of each product. Be sure disadvantages appear as negative numbers. Based on your chart in question 1, put an X in the relevant cell for each of the products to indicate whether it should be sold at split-off or processed further. Sold at split off Processed further Product A