Joint Cost Allocation-Net Realizable Value MethodNature's Garden Inc. produces wood chips, wood pulp, and mulch. These products are produced through harvestingtrees and sending the logs through a wood chipper machine. One batch of logs produces 20,400 cubic yards of woodchips, 10,400 cubic yards of mulch, and 9,200 cubic yards of wood pulp. The joint production process costs à total of$34,000 per batch. After the split-off point, wood chips are immediately sold for $25 per cubic yard while wood pulpand mulch are processed further. The market value of the wood pulp and mulch at the split-off point is estimated to be$22 and $25 per cubic yard, respectively. The additional production process of the wood pulp costs $5 per cubic yard,after which it is sold for $30 per cubic yard. The additional production process of the mulch costs $4 per cubic yard,after which it is sold for $27 per cubic yard.Allocate the joint costs of production to each product using the net realizable value method.Joint ProductWood chipsAllocationXWood pulpMulchTotals34,000 ✔

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Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Hi, I need help solving this Operations Mgmt. problem. Thanks!
The Bawl Corporation supplies alloy ball bearings to automanufacturers in Detroit. Because of its specialized manu-facturing process, considerable work-in-process and rawmaterials are needed. The current inventory levels are$2,470,000 and $1,566,000, respectively. In addition, fin-ished goods inventory is $1,200,000 and sales (at cost) forthe current year are expected to be about $48 million. Ex-press total inventory asa. Weeks of supplyb. Inventory turns
Hau Lee Furniture, Inc., spends 45% of its sales dollars in the supply chain and finds its current profit of $15,000 inadequate. The bank is insisting on an improved profit picture prior to approval of a loan for some new equipment. Hau would like to improve the profit line to $20,000 so he can obtain the bank's approval for the loan. Current Situation Sales Cost of material $100,000 $45,000 (45%) Production costs Fixed cost Profit $25,000 (25%) $15,000 (15%) $15,000 (15%) a) What percentage improvement is needed in the supply chain strategy for profit to improve to $20,000? What is the cost of material with a $20,000 profit? A decrease of 11.1 % in material (supply-chain) costs is required to yield a profit of $20,000, for a new material cost of $40000. (Enter your response for the percentage decrease to one decimal place and enter your response for the new material cost as a whole number.)
Samson is trying to solve the inventory needs for his fidget spinner business. He is in talks with two manufacturing businesses that can solve his problems. He is debating with himself if he should choose one or the other for his business. What role of Operations Management is Samson embodying in this scenario? (A) Storage and Inventory System (B Materials and Requisition Evaluation of Suppliers D Quality Control Management
9.15 If the annual cost of goods sold is $30,000,000 and the average inventory is $5,000,000: a. What is the inventory turns ratio? b. What would be the reduction in average inventory if, through better materials management, inventory turns were increased to 10 times per year? c. If the cost of carrying inventory is 25% of the average inventory, what is the annual savings?
Explain how the KPIs such as days in accounts recievable, claim denial rate, net collection rate, patient verification, and medical coding support strategic planning in the revenue cycle?
Bhatti Company produces plastic photo frames. Two departments, molding and finishing, are involved in the manufacturing. The molding department fills the molds with hot liquid plastic that is left to cool and then opens them. The finishing department removes the plastic frame from the mold and strips the edges of the frames of extra plastic. The following information is available for the month of January: January 1 Quantity (pounds) January 31 Quantity (pounds) Work-in-Process Inventory Cost Cost Molding department Finishing department None None 5,000 $ 15,000 2,000 The WIP Inventory in the finishing department is estimated to be 40% complete for conversion both at the beginning and end of January. Costs of production for January follow: Direct Costs of Production Materials Conversion Molding department Finishing department $ 450,000 $ 90,000 80,290 The molding department started 50,000 pounds of product in January. The firm uses the FIFO method of process costing. Required: 1. Prepare…
The fixed cost at Harley motors are $1M annually. The main product has a revenue of $9.90 per unit and $4.50 variable cost what is the breakeven quantity per year?
A bagel store orders cream cheese from three suppliers, Cheesy Cream Corp. (CCC), Super Smooth & Sons (SSS), and Bagel's Best Friend Co. (BBF). One month, the total order of cheese came to 100 tons. (The store does do a booming trade.) The costs were $80, $50 and $65 per ton from the three suppliers respectively, with the total cost amounting to $6,710. Given that the store ordered the same amount from CCC and BBF, how many tons of cream cheese were ordered from each supplier? Cheesy Cream Corp.____ tons Super Smooth & Sons ____tons Bagel's Best Friend Co. _____tons
For the following bill of material, if we need to produce 10 units of finished product P, how many component C do we need? Assume there is no on-hand inventory. P M(3) 80 0 120 O 16 40 160 N(4) B(3) C(4) D(5) C(4)
Exercise 3 Costs for a month in which it produced 800 units. The production manager was asked to review these costs and provide her best guess as to how they should be categorized. He responded with the following information: Total Costs Variable Costs Fixed Costs Material used in Production OMR 420000 420000 Labour, used in Production 214000 100000 114000 (Assembly and supervisor) Production Facilities cost( rent 115000 90000 250000 „Insurance, Utilities,.) Total production cost 749000 610000 139000 Required: A. Describe the production costs in the equation form Y = f + vX B. Assume Company intends to produce 1200 units next month. Calculate total production costs for the month.

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