Innovative Chemicals produced 12,000 gallons of Xenol and 16,500 gallons of Zyron. The total joint costs incurred in producing both products amounted to $9,500. At the split-off point, Xenol has a market value of $7 per gallon, while Zyron has a market value of $5 per gallon. Compute the portion of the joint costs to be allocated to Xenol if the value basis is used. a. $3,800 b. $4,750 c. $5,600 d. $2,900 e. $6,200

Innovative Chemicals produced 12,000 gallons of Xenol and 16,500 gallons of Zyron. The total joint costs incurred in producing both products amounted to $9,500. At the split-off point, Xenol has a market value of $7 per gallon, while Zyron has a market value of $5 per gallon. Compute the portion of the joint costs to be allocated to Xenol if the value basis is used. a. $3,800 b. $4,750 c. $5,600 d. $2,900 e. $6,200

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 14E: LeMoyne Manufacturing Inc.’s joint cost of producing 2,000 units of Product X, 1,000 units of...

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Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were 50,000, and 14,000 units of overs and 36,000 units of unders were produced. Separable processing costs beyond the split-off point were as follows: overs, 18,000; unders, 23,040. Overs sell for 2.00 per unit; unders sell for 3.14 per unit. Required: 1. Allocate the 50,000 joint costs using the estimated net realizable value method. 2. Suppose that overs could be sold at the split-off point for 1.80 per unit. Should Pacheco sell overs at split-off or process them further? Show supporting computations.
Oakes Inc. manufactured 40,000 gallons of Mononate and 60,000 gallons of Beracyl in a joint production process, incurring 250,000 of joint costs. Oakes allocates joint costs based on the physical volume of each product produced. Mononate and Beracyl can each be sold at the split-off point in a semifinished state or, alternatively, processed further. Additional data about the two products are as follows: An assistant in the companys cost accounting department was overheard saying ...that when both joint and separable costs are considered, the firm has no business processing either product beyond the split-off point. The extra revenue is simply not worth the effort. Which of the following strategies should be recommended for Oakes?
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Laramie Industries produces two joint products, H and C. Prior to the split-off point, the company incurred costs of $66,000. Product H weighs 44 pounds and product C weighs 66 pounds. Product H sells for $250 per pound and product C sells for $295 per pound. Based on a physical measure of output, allocate joint costs to products H and C.
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