Santa Maria Wool Cooperative

Enter a formula into each of the cells marked with a ? below

Example: Joint Product Costs and the Contribution Approach

Requirement:

In industries that process joint products, the costs of the raw materials inputs and the sales values of intermediate and final products are often volatile. Change the data area of your worksheet to match the following:

If your formulas are correct, you should get the correct answers to the following questions.

What is the overall profit if all intermediate products are processed into final products?

Overall profit from processing all intermediate products

What is the residual income? (Input all amounts as positive values.

With these new costs and selling prices, what recommendations would you make concerning the company's operations?

Sell as is or process further the intermediate product undyed coarse wool?
Sell as is or process further the intermediate product undyed fine wool?
Sell as is or process further the intermediate product undyed superfine wool?

If your recommendation in part (c) is followed, what would be the company's overall profit?