Answer:
Spock
Incremental Profit or Loss = -$20,000 --- Loss
Uhura;
Incremental Profit or Loss = $15,000 ---Profit
For Sulu;
Incremental Profit or Loss = $95,000 ---Profit
Explanation:
Given
Sales Value at Split-Off Point Allocated Joint Costs Cost to Process Further Sales Value of Processed Product
Spock $210,000 $40,000 $110,000 $300,000
Uhura 300,000 60,000 85,000 400,000
Sulu 455,000 80,000 250,000 800,000
Calculating the incremental profit or loss that each of the three joint products.
Incremental Profit or Loss is calculated by subtracting profit under processing from the current profits.
i.e.
Incremental Profit or Loss = Profit under processing - Current Profit
Currect profits is calculated as
Sales value at split-off point- allocated joint costs
Profit under processing is calculated as
Sales value of processed product- allocated joint cost - further processing cost
For Spock;
Current Profit = $210,000 - $40,000 = $170,000
Profit Under Processing = $300,000 - $40,000 - $110,000 = $150,000
Incremental Profit or Loss = $150,000 - $170,000
Incremental Profit or Loss = -$20,000 --- Loss
For Uhura;
Current Profit = $300,000 - $60,000 = $240,000
Profit Under Processing = $400,000 - $60,000 - $85,000 = $255,000
Incremental Profit or Loss = $255,000 - $240,000
Incremental Profit or Loss = $15,000 ---Profit
For Sulu;
Current Profit = $455,000 - $80,000 = $375,000
Profit Under Processing = $800,000 - $80,000 - $250,000 = $470,000
Incremental Profit or Loss = $470,000 - $375,000
Incremental Profit or Loss = $95,000 ---Profit
