Coconuts N More produces two joint products, Coconut Milk and Coconut Meat. The company uses the leftover Coconut Skin as a by-product. All three are produced from joint costs of $75,000: direct materials amounting to $50,000 and another $25,000 for direct labor and manufacturing overhead. Beginning inventory for all three products is zero. Information for production of the product is as follows: Product Units Produced in lbs. Units Sold in lbs. Sales price per lb. Coconut Milk 21,000 19,500 $1.30 Coconut Meat 12,200 10,300 6.20 Coconut Skin 2,250 2,000 1.00 How much in joint costs should be allocated to the by-product, using the sales method? Question 1 options: a) $0.00 b) $2,000.00 c) $2,250.00 d) $1,604.00
Coconuts N More produces two joint products, Coconut Milk and Coconut Meat. The company uses the leftover Coconut Skin as a by-product. All three are produced from joint costs of $75,000: direct materials amounting to $50,000 and another $25,000 for direct labor and manufacturing overhead. Beginning inventory for all three products is zero. Information for production of the product is as follows: Product Units Produced in lbs. Units Sold in lbs. Sales price per lb. Coconut Milk 21,000 19,500 $1.30 Coconut Meat 12,200 10,300 6.20 Coconut Skin 2,250 2,000 1.00 How much in joint costs should be allocated to the by-product, using the sales method? Question 1 options: a) $0.00 b) $2,000.00 c) $2,250.00 d) $1,604.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Coconuts N More produces two joint products, Coconut Milk and Coconut Meat. The company uses the leftover Coconut Skin as a by-product. All three are produced from joint costs of $75,000: direct materials amounting to $50,000 and another $25,000 for direct labor and manufacturing
| Product | Units Produced in lbs. | Units Sold in lbs. | Sales price per lb. |
| Coconut Milk | 21,000 | 19,500 | $1.30 |
| Coconut Meat | 12,200 | 10,300 | 6.20 |
| Coconut Skin | 2,250 | 2,000 | 1.00 |
How much in joint costs should be allocated to the by-product, using the sales method?
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