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 $240,000. Additional Information follows: Product FP-10 FP-20 FP-40 Units Produced 66,000 99,000 55,000 Sales Values $ 168,000 308,000 84,000 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 55.000 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? Processing Costs (After Split-Off) $ 28,000 108,000 24,000 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 55.000 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Joint costs allocated Required A Required B Required C 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? Note: Do not round intermediate calculations. FP-10 FP-20 < Required A Required B >
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 $240,000. Additional Information follows: Product FP-10 FP-20 FP-40 Units Produced 66,000 99,000 55,000 Sales Values $ 168,000 308,000 84,000 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 55.000 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? Processing Costs (After Split-Off) $ 28,000 108,000 24,000 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 55.000 units of FP-40 produced? Complete this question by entering your answers in the tabs below. Joint costs allocated Required A Required B Required C 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? Note: Do not round intermediate calculations. FP-10 FP-20 < Required A Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Subject: acounting
Transcribed Image Text: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 $240,000. Additional Information follows:
Product
FP-10
FP-20
FP-48
Units
Produced
66,000
99,000
55,000
Sales Values
$ 168,000
308,000
84,000
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
55.000 units produced.
Processing
Costs (After
Split-Off)
$ 28,000
108,000
24,000
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 55.000 units of FP-40 produced?
Complete this question by entering your answers in the tabs below.
Joint costs allocated
Required A Required B
Required C
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?
Note: Do not round intermediate calculations.
FP-10
FP-20
< Required A
Required B >
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