Crestwood Industries mixes together sugarcane residue and ethanol. After joint manufacturing costs of $3,500 have been incurred, the mixture separates into two products, biomass fuel and industrial alcohol. At the split- off point, biomass fuel can be sold for $6,500, and the alcohol can be sold for $10,500. The biomass fuel can be further processed at a cost of $7,500 to make bio-bricks, which could be sold for $17,500. The alcohol can be further processed at a cost of $8,500 to make a disinfectant, which could be sold for $16,500. What is the net increase (decrease) in operating income from bio-bricks?

Crestwood Industries mixes together sugarcane residue and ethanol. After joint manufacturing costs of $3,500 have been incurred, the mixture separates into two products, biomass fuel and industrial alcohol. At the split- off point, biomass fuel can be sold for $6,500, and the alcohol can be sold for $10,500. The biomass fuel can be further processed at a cost of $7,500 to make bio-bricks, which could be sold for $17,500. The alcohol can be further processed at a cost of $8,500 to make a disinfectant, which could be sold for $16,500. What is the net increase (decrease) in operating income from bio-bricks?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter6: Process Cost Accounting—additional Procedures; Accounting For Joint Products And By-products

Section: Chapter Questions

Problem 13P: Venezuela Oil Inc. transports crude oil to its refinery where it is processed into main products...

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Crestwood Industries mixes together sugarcane residue and ethanol. After joint manufacturing costs of $3,500 have been incurred, the mixture separates into two products, biomass fuel and industrial alcohol. At the split-off point, biomass fuel can be sold for $6,500, and the alcohol can be sold for $10,500. The biomass fuel can be further processed at a cost of $7,500 to make bio-bricks, which could be sold for $17,500. The alcohol can be further processed at a cost of $8,500 to make a disinfectant, which could be sold for $16,500.What is the net increase (decrease) in operating income from bio-bricks?need answer
Crestwood Industries mixes together sugarcane residue and ethanol. After joint manufacturing costs of $3,500 have been incurred, the mixture separates into two products, biomass fuel and industrial alcohol. At the split-off point, biomass fuel can be sold for $6,500, and the alcohol can be sold for $10,500. The biomass fuel can be further processed at a cost of $7,500 to make bio-bricks, which could be sold for $17,500. The alcohol can be further processed at a cost of $8,500 to make a disinfectant, which could be sold for $16,500.What is the net increase (decrease) in operating income from bio-bricks?
What is the net increase in operating income from air filters?
Brevall Industries makes corn oil and corn meal from harvested corn in a joint process. Corn oil can be further processed into margarine, and the corn meal can be further processed into corn muffin mix. The joint cost incurred to process the corn to the split-off point is $140,000. Information on the quantities, value, and further processing costs for the joint product appears below: Sales Value Estimated Further Sales Value Quantity At Split-off Processing Cost After Processing Corn Oil 800,000 lbs. $0.30/lb. $0.35/lb. $0.60/lb. Corn Meal 1,600,000 lbs. 0.10/lb. 0.40/lb. 0.55/lb. Brevall allocates the joint cost to the products based on physical units. Corn oil is assigned $46,667 of joint cost and corn meal is assigned $93,333 of joint cost. Which…
Brevall Industries makes corn oil and corn meal from harvested corn in a joint process. The corn oil can be further processed into margarine, and the corn meal can be further processed into corn muffin mix. The joint cost incurred to process the corn to the split-off point is $140,000. Information on the quantities, value, and further processing costs for the joint products appear below: Sales Value Estimated Further Sales Value Quantity At Split-off Processing Cost After Processing Corn Oil 800,000 lbs. $0.30/lb. $0.15/lb. $0.60/lb. Corn Meal 1,600,000 lbs. 0.10/lb. 0.46/lb. 0.55/lb. Brevall allocates the joint cost to the products based on the relative sales value at split-off point. How much joint cost should be assigned to the corn meal?…
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Chemical Corporation produces liquid chemicals A and B from a joint process. Joint costs are allocated on the basis of relative sales value at split-off. It costs $4,560 to process 500 gallons of Product A and 1,000 gallons of Product B to the split-off point. The market value at split-off is $10 per gallon for Product A and $14 for Product B. Product B requires an additional process beyond split-off at a cost of $2 per gallon before it can be sold. What is Chemical's cost to produce 1,000 gallons of Product B? Choose... Choose... $4,860 $5,360 $3,360 $5,040
Autry Company manufactures veterinary products. One joint process involves refining a chemical (dactylyte) into two chemicals: dac and tyl. One batch of 5,000 gallons of dactylyte can be converted to 2,000 gallonsof dac and 3,000 gallons of tyl at a total joint processing cost of $12,000. At the split-off point, dac can be sold for $3 per gallon and tyl can be sold for $4 per gallon.Autry has just learned about a new process to convert dac into prodac. The new process costs $4,000 and yields 1,700 gallons of prodac for every 2,000 gallons of dac. Prodac sells for $5 per gallon. Should Autry process dac further? a. No, income will decrease by $1,500. b. No, income will decrease by $5,000. c. Yes, income will increase by $1,500. d. Yes, income will increase by $5,000. e. It doesn't matter; income will be the same.
Autry Company manufactures veterinary products. One joint process involves refining a chemical (dactylyte) into two chemicals − dac and tyl. One batch of 5,000 gallons of dactylyte can be converted to 2,000 gallons of dac and 3,000 gallons of tyl at a total joint processing cost of $12,000. At the split-off point, dac can be sold for $3 per gallon and tyl can be sold for $4 per gallon. Autry has just learned of a new process to convert dac into prodac. The new process costs $4,000 and yields 1,700 gallons of prodac for every 2,000 gallons of dac. Prodac sells for $5 per gallon. Should Autry process dac further? Yes, income will be $1,500 higher. Yes, income will be $5,000 higher. No, income will be $5,000 lower. It doesn't matter; income will be the same. No, income will be $1,500 lower.
Autry Company manufactures veterinary products. One joint process involves refining a chemical (dactylyte) into two chemicals − dac and tyl. One batch of 5,000 gallons of dactylyte can be converted to 2,000 gallons of dac and 3,000 gallons of tyl at a total joint processing cost of $12,000. At the split-off point, dac can be sold for $3 per gallon and tyl can be sold for $4 per gallon. Autry has just learned of a new process to convert dac into prodac. The new process costs $4,000 and yields 1,700 gallons of prodac for every 2,000 gallons of dac. Prodac sells for $5 per gallon. What is Autry's profit from refining one batch of dactylyte if both dac and tyl are sold at the split-off point? $7,000 $6,000 $15,000 $12,000 $18,000
Tucariz Company processes Duo into two joint products, Big and Mini. Duo is purchase in 1,000-gallon drums for $2,000. Processing costs are $3,000 to process the 1,000 gallons of Duo into 800 gallons of Big and 200 gallons of Mini. The selling price is $9 per gallon for Big and $4 per gallon for Mini. If the sales value at split-off method is used to allocate joint costs to the final products, the per-gallon cost (rounded to the nearest cent) of producing Big is Select one: a. $5.00 per gallon. b. $5.63 per gallon. c. $4.50 per gallon. X d. $3.38 per gallon.
Joint Products Arkansas Corporation manufactures liquid chemicals A and B from a joint process. It allocates joint costs on the basis of sales value at split-off. Processing 5,000 gallons of productA and 1,000 gallons of product B to the split-off point costs $5,600. The sales value at split-off is $2per gallon for product A and $30 per gallon for product B. Product B requires additional separableprocessing beyond the split-off point at a cost of $2.50 per gallon before it can be sold at a price of$34 per gallon.Required What is the company’s cost to produce 1,000 gallons of product B?