Answer (D) is correct . If all products are sold at split-off, the gross profit is computed as follows: Product A (1,000 ¡Á $4.00) $?? 4,000 Product B (2,000 ¡Á $2.25) 4,500 Product C (1,500 ¡Á $3.00) 4,500 Total sales $?13,000 Joint costs (10,000) Gross profit $?? 3,000<
Answer (A) is incorrect because This amount is the total sales if all products are sold at split-off.
Answer (B) is incorrect because This amount is the joint production cost during October.
Answer (C) is incorrect because If all products were sold at split-off, total sales are determined by multiplying units produced by the unit sales price at split-off, not the unit sales price if processed further.
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Assuming that all products were sold at the split-off point during October, the gross profit from the production process would be
