how much additional profit could the company have generated in 2010 if it had made o 643927
(Processing beyond split off ) Washington Cannery makes three products from a single joint process. For 2010, the cannery processed all three products beyond split off . The following data were generated for the year:
|
Joint Product |
Incremental Separate Cost |
Total Revenue |
|
Candied apples |
$26,000 |
$680,000 |
|
Apple jelly |
38,000 |
765,000 |
|
Apple jam |
15,000 |
289,000 |
Analysis of 2010 market data reveals that candied apples, apple jelly, and apple jam could have been sold at split off for $670,000, $730,000, and $260,000, respectively.
a. Based on hindsight, evaluate management’s production decisions in 2010.
b. How much additional profit could the company have generated in 2010 if it had made optimal decisions at split off ?