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Grade of Walnuts Number 1 Number 2 Number 3 Total Sales $ 490, 500 381, 500 218,000 $ 1,090,000 The company incurred the following joint costs for the year. Tree pruning and care $ 708,500 Pickup, sorting, and grading 141, 700

Grade of Walnuts Number 1 Number 2 Number 3 Total Sales $ 490, 500 381, 500 218,000 $ 1,090,000 The company incurred the following joint costs for the year. Tree pruning and care $ 708,500 Pickup, sorting, and grading 141, 700

FINANCIAL ACCOUNTING
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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**California Orchards Sales Report** California Orchards reports the following sales data for the year ended December 31: | Grade of Walnuts | Sales | |-----------------|-----------| | Number 1 | $490,500 | | Number 2 | $381,500 | | Number 3 | $218,000 | | **Total** | **$1,090,000** | The company incurred the following joint costs for the year: - Tree pruning and care: $708,500 - Pickup, sorting, and grading: $141,700 **Assignment:** 1. **Compute Gross Profit for Walnuts:** Compute the gross profit for each of the three grades of walnuts. Assume the cost of goods sold consists only of the joint costs. | Grade | Gross Profit | |----------|--------------| | Number 1 | | | Number 2 | | | Number 3 | | | **Total** | | **Instructions:** Use the sales data and joint costs to determine the gross profit for each grade of walnuts. Consider the sales revenue and deduct the joint costs allocated to each grade to find the gross profit accordingly.
Transcribed Image Text:**California Orchards Sales Report** California Orchards reports the following sales data for the year ended December 31: | Grade of Walnuts | Sales | |-----------------|-----------| | Number 1 | $490,500 | | Number 2 | $381,500 | | Number 3 | $218,000 | | **Total** | **$1,090,000** | The company incurred the following joint costs for the year: - Tree pruning and care: $708,500 - Pickup, sorting, and grading: $141,700 **Assignment:** 1. **Compute Gross Profit for Walnuts:** Compute the gross profit for each of the three grades of walnuts. Assume the cost of goods sold consists only of the joint costs. | Grade | Gross Profit | |----------|--------------| | Number 1 | | | Number 2 | | | Number 3 | | | **Total** | | **Instructions:** Use the sales data and joint costs to determine the gross profit for each grade of walnuts. Consider the sales revenue and deduct the joint costs allocated to each grade to find the gross profit accordingly.
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