Below is the answer | ||||
Statement showing computations | ||||
Particulars | Molecule | Borphue | Polyguard | Total |
No of Gallons | 3,000.00 | 10,000.00 | 1,000.00 | |
Revenue per Gallon | 22.00 | 15.00 | 6.00 | |
Total revenue | 66,000.00 | 1,50,000.00 | 6,000.00 | 2,22,000.00 |
Additional costs | 10,700.00 | 1,500.00 | 12,200.00 | |
Joint costs | 30,800.00 | |||
Profitability | 1,79,000.00 | |||
b) | ||||
Revenue after further processing | 22.00 | |||
Revenue at split off point | 6.00 | |||
Incremental revenue per gallon | 16.00 | |||
No of Gallon | 3,000.00 | |||
Total incremental revenue | 48,000.00 | |||
Additional costs | 10,700.00 | |||
Incremental profit | 37,300.00 | |||
Process further | ||||
c) | ||||
Revenue after further processing | 6,000.00 | |||
Revenue at split off point | 3,100.00 | |||
Loss of revenue | -2,900.00 | |||
Savings of additional costs | 1,500.00 | |||
Incremental profit (Loss) if process further | -1,400.00 | |||
If it accepts the offer it will suffer loss of $1,400 |
BioMorphs Corporation produces three products in a monthly joint production process. During the first stage of...
BioMorphs Corporation produces three products in a monthly joint production process. During the first stage of the process liquids and chemicals costing $59,200 are heated and three different compounds emerge: 3,000 gallons of Molecue worth $22 per gallon are created from the steam; 10,000 gallons of Borphue worth $15 are drained from the tank; and 1,000 gallons of the tank residue, labeled as Polygard, are sold as fertilizer for $6.00 per gallon. Before Molecue is sold, it must be purified...
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