Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are $360,000 for a standard production run that generates 170,000 pints of Smooth Skin and 300,000 pints of Silken Skin. Smooth Skin sells for $3.20 per pint, while Silken Skin sells for $5.20 per pint. Required: 1. Assuming that both products are sold at the split-off point, how much of the joint cost of each production run is allocated to Smoot Skin using the relative sales value method? 2. If no separable costs are incurred after the split-off point, how much of the joint cost of each production run is allocated to Silken Skin using the physical measure method? 3. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how much of the joint cost of each production run is allocated to Silken Skin using a net realizable value method? 4. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how much of the joint cost of each production run is allocated to Smooth Skin using a physical measure method? (For all requirements, do not round intermediate calculations. Round final answers to nearest whole dollar amounts.) 1. Relative sales value method - Smooth Skin 2. Physical measure method - Silken Skin 3. Net realizable value method - Silken Skin 4. Physical measure method - Smooth Skin

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are
$360,000 for a standard production run that generates 170,000 pints of Smooth Skin and 300,000 pints of Silken Skin. Smooth Skin
sells for $3.20 per pint, while Silken Skin sells for $5.20 per pint.
Required:
1. Assuming that both products are sold at the split-off point, how much of the joint cost of each production run is allocated to Smooth
Skin using the relative sales value method?
2. If no separable costs are incurred after the split-off point, how much of the joint cost of each production run is allocated to Silken
Skin using the physical measure method?
3. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how
much of the joint cost of each production run is allocated to Silken Skin using a net realizable value method?
4. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how
much of the joint cost of each production run is allocated to Smooth Skin using a physical measure method?
(For all requirements, do not round intermediate calculations. Round final answers to nearest whole dollar amounts.)
1. Relative sales value method - Smooth Skin
2.
Physical measure method - Silken Skin
3.
Net realizable value method - Silken Skin
4.
Physical measure method - Smooth Skin
Transcribed Image Text:Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are $360,000 for a standard production run that generates 170,000 pints of Smooth Skin and 300,000 pints of Silken Skin. Smooth Skin sells for $3.20 per pint, while Silken Skin sells for $5.20 per pint. Required: 1. Assuming that both products are sold at the split-off point, how much of the joint cost of each production run is allocated to Smooth Skin using the relative sales value method? 2. If no separable costs are incurred after the split-off point, how much of the joint cost of each production run is allocated to Silken Skin using the physical measure method? 3. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how much of the joint cost of each production run is allocated to Silken Skin using a net realizable value method? 4. If separable processing costs beyond the split-off point are $1.80 per pint for Smooth Skin and $1.70 per pint for Silken Skin, how much of the joint cost of each production run is allocated to Smooth Skin using a physical measure method? (For all requirements, do not round intermediate calculations. Round final answers to nearest whole dollar amounts.) 1. Relative sales value method - Smooth Skin 2. Physical measure method - Silken Skin 3. Net realizable value method - Silken Skin 4. Physical measure method - Smooth Skin
Expert Solution
steps

Step by step

Solved in 5 steps

Blurred answer
Knowledge Booster
Decision to Sell before or after additional processing
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education