Gibson Chicken Corporation processes and packages chicken for grocery stores. It purchases chickens from far them into two different products: chicken drumsticks and chicken steak. From a standard batch of 15,000 pounc costs $8,200, the company produces two parts: 2,000 pounds of drumsticks and 5,000 pounds of breast for a p $3,887. The chicken breast is further processed into 4,200 pounds of steak for a processing cost of $2,200. The drumsticks per pound is $1.65 and the market price per pound of chicken steak is $4.2o. If Gibson decided to se instead of chicken steak, the price per pound would be $2.40. Required a-1. Allocate the joint cost to the joint products, drumsticks and breasts, using weight as the allocation base. a:? Calculate the gross profit for each nroduct

Gibson Chicken Corporation processes and packages chicken for grocery stores. It purchases chickens from far them into two different products: chicken drumsticks and chicken steak. From a standard batch of 15,000 pounc costs $8,200, the company produces two parts: 2,000 pounds of drumsticks and 5,000 pounds of breast for a p $3,887. The chicken breast is further processed into 4,200 pounds of steak for a processing cost of $2,200. The drumsticks per pound is $1.65 and the market price per pound of chicken steak is $4.2o. If Gibson decided to se instead of chicken steak, the price per pound would be $2.40. Required a-1. Allocate the joint cost to the joint products, drumsticks and breasts, using weight as the allocation base. a:? Calculate the gross profit for each nroduct

Name: Problem 4-24A (Algo) Allocating joint product cost LO 4-4Gibson Chick
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Description: Problem 4-24A (Algo) Allocating joint product cost LO 4-4Gibson Chicken Corporation processes and packages chicken for grocery stores. It purchases chickens from farmers and processesthem into two different products: chicken drumsticks and chicken s

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Gibson Chicken Corporation processes and packages chicken for grocery stores. It purchases chickens from farmers and processes them into two different products: chicken drumsticks and chicken steak. From a standard batch of 15,000 pounds of raw chicken that costs $8,200, the company produces two parts: 2,000 pounds of drumsticks and 5,000 pounds of breast for a processing cost of $3,887. The chicken breast is further processed into 4,200 pounds of steak for a processing cost of $2,200. The market price of drumsticks per pound is $1.65 and the market price per pound of chicken steak is $4.20. If Gibson decided to sell chicken breast instead of chicken steak, the price per pound would be $2.40. Required a-1. Allocate the joint cost to the joint products, drumsticks and breasts, using weight as the allocation base. a-2. Calculate the gross profit for each product. a-3. If the drumsticks are producing a loss, should that product line be eliminated? b-1. Reallocate the joint cost to the…
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