A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $13,000. None of the products can be sold at split-off, but must b processed further. Information on one batch of the three products is as follows: Product Gallons 3,400 4,000 2,400 L-Ten Triol Pioze Required: Further Processing Cost per Gallon $0.50 1.00 1.50 Eventual Market Price per Gallon $2.00 5.00 6.00 1. Calculate the total revenue, total costs, and total gross profit the company will earn on the sale of L-Ten, Triol, and Pioze. 8 Total Revenue Total Costs Total Gross Profit 2. Allocate the joint cost to L-Ten, Triol, and Pioze using the constant gross margin percentage method. Round the gross margin percentage to four decimal places and rou all other computations to the nearest dollar.

A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $13,000. None of the products can be sold at split-off, but must b processed further. Information on one batch of the three products is as follows: Product Gallons 3,400 4,000 2,400 L-Ten Triol Pioze Required: Further Processing Cost per Gallon $0.50 1.00 1.50 Eventual Market Price per Gallon $2.00 5.00 6.00 1. Calculate the total revenue, total costs, and total gross profit the company will earn on the sale of L-Ten, Triol, and Pioze. 8 Total Revenue Total Costs Total Gross Profit 2. Allocate the joint cost to L-Ten, Triol, and Pioze using the constant gross margin percentage method. Round the gross margin percentage to four decimal places and rou all other computations to the nearest dollar.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Toil & Oil processes crude oil to jointly produce gasoline, diesel, and kerosene. One batch produces 3,415 gallons of gasoline, 2,732 gallons of diesel, and 1,366 gallons of kerosene at a joint cost of $12,000. After the split-off point, all products are processed further, but the estimated market price for each product at the split-off point is as follows: Gasoline $2 per gallon Diesel 1 per gallon Kerosene 3 per gallon Using the market value at split-off method, allocate the $12,000 joint cost of production to each product.
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Fact Pattern: Atlas Foods produces the following three supplemental food products simultaneously through a refining process costing $93,000. The joint products, Alfa and Betters, have a final selling price of $4 per pound and $10 per pound, respectively, after additional processing costs of $2 per pound of each product are incurred after the split-off point. Morefeed, a by- product, is sold at the split-off point for $3 per pound. O A. $60,000 $31,000 $3,000 $30,000 O B. C. Alfa D. Betters Assuming Atlas Foods inventories Morefeed, the by-product, the joint cost to be allocated to Alfa using the net realizable value method is 10,000 pounds of Alfa, a popular but relatively rare grain supplement having a caloric value of 4,400 calories per pound 5,000 pounds of Betters, a flavoring material high in carbohydrates with a caloric value of 11,200 calories per pound Morefeed 1,000 pounds of Morefeed, used as a cattle feed supplement with a caloric value of 1,000 calories per pound
Alpesh
Y Company produces two joint products: Sweet and Sour. Joint cost is allocated using the net realizable value method at split-off point. Joint production cost is $70,000. Neither product is salable at split-off point. During May, the additional costs incurred beyond split-off point are as follows: Sweet $ 32,000 Sour $ 48,000 Production: Sweet: 3,200 units Sour: 1,600 units Selling prices: Sweet: $50.00 per unit Sour: $ 90.00 per unit What is the amount of joint cost allocated to Sweet and Sour using the NRV Method at split-off point. (Must show calculations or no credit) Joint cost allocated to Sweet: $_____________________________ Joint cost allocated to Sour:…
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PT Y manufactures three products using the same production process. The costs incurred up to the split-off point are $200,000. The company decided to further process the three products before they were sold. The number of units produced (based on regular sales), the selling prices per unit of the three products at the split-off point and after further processing, and the additional processing costs are as follows. Product D E F Number of Units Produced 4,000 6,000 2,000 Selling Price at Split-Off Additional Processing Costs Selling Price after Processing $25.00 $26.60 $34.40 $14,000 $20,000 $9,000 $30.00 $31.20 $37.60 Instructions 1) Allocate the $200,000 joint cost to product D, E, and F using these methods: a. Physical-measure method (2%) b. NRV method (5%) 2) Which information is relevant to the decision on whether or not to process the products further? (2%). Explain why this information is relevant (2%). 3) Which product(s) should be processed further and which should be sold at…
Sunland Inc. produces three separate products from a common process costing $100,100. Each of the products can be sold at the split- off point or can be processed further and then sold for a higher price. Shown below are cost and selling price data for a recent period. Product 10 Product 12 Product 14 (c) Product Your answer is partially correct. Product 10 Product 12 Product 14 $ Sales Value at Split-Off Point $59,700 $ 15,800 $ 55,400 Calculate incremental profit/(loss) and determine which products should be sold at the split-off point and which should be processed further. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Incremental profit (loss) Cost to Process Further eTextbook and Media $100,100 30,800 149,700 Sales Value after Further Processing $191,000 34,700 Decision 214,000 Should be processed further Should be sold at the split-off point Should be processed further Assistance Used