Assuming again that all quantities are sold, calculate gross margin for the division if Grade 2 is further processed into Grade 3 and the NRV method is used to allocate joint costs. As the manager of the granite-crushing division, George has just recently started evaluating product profitability. The joint process for his division generates Grade 1 and Grade 2 granite pieces. Both grades at this point can be sold as-is, or Grade 2 can be processed further into Grade 3 (a stabilizer is added while it's further processed into very fine pieces). The quantities, costs, and sales values for the different grades of product are as follows