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Chapter 8 Additional Exercises 1. Sell or Process Further. Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $350,000 per quarter. 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: Product Selling Price Quarterly Output $16 per pound 15,000 pounds B $8 per pound 20,000 pounds $25 per gallon 4,000 gallons 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. Product B Additional Processing Costs $63,000 $80,000 $36,000 Selling Price $20 per pound $13 per pound $32 per gallon Which product(s) should be sold at the split-off point? Which product(s) should be processed further? Product A Product B Product C Selling price after further processing Selling price at the split-off point Incremental revenue per unit Total quarterly output per unit Total incremental revenue Total incremental processing costs Total incremental profit (loss)