Savory produces two types of microwavable products: beef-flavored ramen and shrimp-flavored ramen. The two products share common inputs such as noodle and spices. The production of ramen results in a waste product referred to as stock, which dumps at negligible costs in a local drainage area. In June 2014
the following data were reported for the production and sales of beef-flavored and shrimp-flavored ramen:
Due to the popularity of its microwavable products, Savory decides to add a new line of products that targets dieters. These new products are produced by adding a special ingredient to dilute the original ramen and are to be sold under the names Special B and Special S, respectively. Following are the monthly data for all the products:
Joint Costs Joint costs(costs of noodles, spices, and other inputs and processing to splitoff point) s 230,000 Beef Shrimp Ramen Ramen Beginning inventory (tons) Production (tons) Sales (tons) Selling price per ton 0 13,000 16,000 13,000 16,000 $45 $ 60
