Homework Help is Here – Start Your Trial Now!
Business
Accounting
Exercise 11-52 (Algo) Physical Quantities Method; Sell or Process Further (LO 11-3, 4) Forest Products, Incorporated, manufactures three products (FP-10, FP-20, and FP-40) from a single, joint input. None of the products can be sold without further processing. In November, joint product costs were $241,700. Additional Information follows: Sales Values Product FP-10 FP-20 FP-40 Units Produced 117,000 175,500 97,500 $ 180,750 312,250 85,700 Processing Costs (After Split-Off) $ 29,700 109,700 25,700 The sale of FP-40 has been banned by a recent law. If FP-40 is produced, disposal in an approved manner costs $120,000 for every 97,500 units produced. Required: a. Assuming that Forest Products continues to use the physical quantities method of allocation and to manufacture and sell FP-10 and FP-20. What joint costs would be allocated to FP-10 and FP-20? b. There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? c. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further, In case the disposal cost for FP-40 Increases to $150,000 for every 97,500 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Required A Required B Required C There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? Indifference point FP-10 FP-20 < Required A Required C >

Exercise 11-52 (Algo) Physical Quantities Method; Sell or Process Further (LO 11-3, 4) Forest Products, Incorporated, manufactures three products (FP-10, FP-20, and FP-40) from a single, joint input. None of the products can be sold without further processing. In November, joint product costs were $241,700. Additional Information follows: Sales Values Product FP-10 FP-20 FP-40 Units Produced 117,000 175,500 97,500 $ 180,750 312,250 85,700 Processing Costs (After Split-Off) $ 29,700 109,700 25,700 The sale of FP-40 has been banned by a recent law. If FP-40 is produced, disposal in an approved manner costs $120,000 for every 97,500 units produced. Required: a. Assuming that Forest Products continues to use the physical quantities method of allocation and to manufacture and sell FP-10 and FP-20. What joint costs would be allocated to FP-10 and FP-20? b. There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? c. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further, In case the disposal cost for FP-40 Increases to $150,000 for every 97,500 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Required A Required B Required C There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? Indifference point FP-10 FP-20 < Required A Required C >

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter8: Tactical Decision-making And Relevant Analysis
Section: Chapter Questions
Problem 43E
See similar textbooks
icon
Related questions
Question
Exercise 11-52 (Algo) Physical Quantities Method; Sell or Process Further (LO 11-3, 4) Forest Products, Incorporated, manufactures three products (FP-10, FP-20, and FP-40) from a single, joint input. None of the products can be sold without further processing. In November, joint product costs were $241,700. Additional Information follows: Sales Values Product FP-10 FP-20 FP-40 Units Produced 117,000 175,500 97,500 $ 180,750 312,250 85,700 Processing Costs (After Split-Off) $ 29,700 109,700 25,700 The sale of FP-40 has been banned by a recent law. If FP-40 is produced, disposal in an approved manner costs $120,000 for every 97,500 units produced. Required: a. Assuming that Forest Products continues to use the physical quantities method of allocation and to manufacture and sell FP-10 and FP-20. What joint costs would be allocated to FP-10 and FP-20? b. There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? c. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further, In case the disposal cost for FP-40 Increases to $150,000 for every 97,500 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Required A Required B Required C There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? Indifference point FP-10 FP-20 < Required A Required C >
Transcribed Image Text:Exercise 11-52 (Algo) Physical Quantities Method; Sell or Process Further (LO 11-3, 4) Forest Products, Incorporated, manufactures three products (FP-10, FP-20, and FP-40) from a single, joint input. None of the products can be sold without further processing. In November, joint product costs were $241,700. Additional Information follows: Sales Values Product FP-10 FP-20 FP-40 Units Produced 117,000 175,500 97,500 $ 180,750 312,250 85,700 Processing Costs (After Split-Off) $ 29,700 109,700 25,700 The sale of FP-40 has been banned by a recent law. If FP-40 is produced, disposal in an approved manner costs $120,000 for every 97,500 units produced. Required: a. Assuming that Forest Products continues to use the physical quantities method of allocation and to manufacture and sell FP-10 and FP-20. What joint costs would be allocated to FP-10 and FP-20? b. There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? c. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further, In case the disposal cost for FP-40 Increases to $150,000 for every 97,500 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Required A Required B Required C There is a possibility that a market for FP-10 and FP-20 at split-off will develop. In other words, it will be possible to sell the two products rather than process them further. At what sales value (at split-off) would Forest Products be indifferent between selling them at split-off and processing them further? Indifference point FP-10 FP-20 < Required A Required C >
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS