Answer:
MARIN PRODUCTS
Sales after further processing
DBB-1 DBB-2 DBB-3
units sold 16,000 24,000 36,000
Revenue post-processing $1,040,000 $1,200,000 $2,700,000
Joint expenditure (757,895) (1,136,842) (1,705,263)
Individual processing cost (110,000) (44,000) (66,000)
Net profit 172,105 10,158 928,737
sale at split-off point
DBB-1 DBB-2 DBB-3
units sold 16,000 24,000 36,000
Sales revenue $400,000 $840,000 $1,980,000
Joint expenditure (757,895) (1,136,842) (1,705,263)
Net profit (357,895) (296,842) 274,737
Conclusion: All products should undergo further processing to enhance the company's profit margins
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Cost per unit = $3,600,000/76,000 = $47.37
DBB-1 = $47.37*16,000 = $757,895
DBB-2 = $47.37*24,000 = $1,136,842
DBB-3 = $47.37*36,000 = $1,705,263
Explanation:
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