Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows: Product Grades L-Ten Triol L-Ten Triol Pioze Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost Pioze Grades L-Ten Triol Gallons 3,600 4,100 2,500 Pioze Further Processing Cost per Gallon Total $0.60 0.90 1.50 Allocation 2,109 X Total 2. What if it cost $1.90 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. 110000 Eventual Market Price per Gallon Joint Cost $2.60 5.40 6.50 Allocation
Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows: Product Grades L-Ten Triol L-Ten Triol Pioze Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost Pioze Grades L-Ten Triol Gallons 3,600 4,100 2,500 Pioze Further Processing Cost per Gallon Total $0.60 0.90 1.50 Allocation 2,109 X Total 2. What if it cost $1.90 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. 110000 Eventual Market Price per Gallon Joint Cost $2.60 5.40 6.50 Allocation
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 10CE: A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each...
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