Lisa owns a small apple orchard and press operation. After picking and selling the high-grade apples in their fresh state, she pressesthe remaining apples into juice. This process also yields pomace (a pulp like product). There is a market for both the juice and thepomace immediately after this joint pressing process is complete. The joint processing costs are $32,000. Both of these products canbe processed further: the juice can be turned into hard cider, while the pomace can be turned into jam. The values of each product atdifferent stages of completion, along with the additional costs that will be incurred if the products are processed further, are asfollows.Apple juice/hard ciderApple pomace/jam(a)Sales Valueat Split-OffAdditionalProcessing CostFinal SalesValue$39,950$15,132$93,0007.0505.16820,000If Lisa uses the sales value at split-off method to allocate the joint costs, how much will be allocated to each product? (Round If Lisa uses the NRV method to allocate joint costs, how much will be allocated to each product? (Round proportion to 2 decimalplaces, e.g. 0.25 and final answers to O decimal places, e.g. 5,125.)Allocated joint costs$Apple Juice/Hard CiderApple Pomace/Jam$

a. Allocation of joint costs using sales value at split-off point method: Apple Juice/ Hard…

Answered: Lisa owns a small apple orchard and…

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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A horticulturist has just set up vegetable cultivation in a greenhouse where he grows peppers and tomatoes using sustainable energy sources, electricity for lighting and thermal energy for heating. He grows x units of peppers and y units of tomatoes. The entire amount that the farmer grows is sent to the market. The cost function of the crop is described as follows equation: ?(?, ?) = 12?2 + 24?2 The lighting's capacity means that it cannot grow more than 5,000 units in total per month. a. What should be the division between the production of peppers and tomatoes to minimize cost per month with the aim of always fully utilizing the capacity of the greenhouse? What is this minimum cost per month? b. Explain the significance of calculating the Lagrange multiplier i.e. interpret and at the same time discuss how it can be used to calculate if more productive lighting is obtained in the greenhouse and the cultivation will be 5,750 units per month.
Illion Soy Products (ASP) buys soybeans and processes them into other soy products. Each ton of soybeans that ASP purchases for $250 can be converted for an additional $180 into 700 lbs of soy meal and 80 gallons of soy oil. A pound of soy meal can be sold at splitoff for $1.08 and soy oil can be sold in bulk for $4 per gallon. ASP can process the 700 pounds of soy meal into 800 pounds of soy cookies at an additional cost of $370. Each pound of soy cookies can be sold for $2.08 per pound. The 80 gallons of soy oil can be packaged at a cost of $200 and made into 320 quarts of Soyola. Each quart of Soyola can be sold for $1.45. Read the requirements. Requirement 1. Allocate the joint cost to the cookies and the Soyola using the (a) Sales value at splitoff method and (b) NRV method. a. First, allocate the joint cost using the Sales value at splitoff method. (Round the weights to three decimal places and joint costs to the nearest dollar.) Sales value of total production at splitoff…
Mrs. XYZ cultivates sorghum and wheat on a farm with an area of 570 hectares that is suitable for cultivation. Her expected yield is 3.3 tons per hectare for sorghum and 2.3 tons per hectare for wheat. The expected prices are R 3 450 per ton for sorghum and R 2 800 per ton for wheat. Fixed costs are R 325 000. He estimates input costs of R 2 750 per ton for sorghum and R 3 050 per ton for wheat. Consider the information for Mr XYZ’s farm to determine the minimum cultivated area he needs for his gross income to break even with his total cost.
Underground Food Store has 6,000 pounds of raw beef nearing its expiration date. Each pound has a cost of $4.40. The beef could be sold "as is" for $3.00 per pound to the dog food processing plant, or roasted and sold in the deli. The cost of roasting the beef will be $2.70 per pound, and each pound could be sold for $6.40. What should be done with the beef, and why? If required, round final answers to two decimal places. The beef should be processed further since the sales price will increase by $??? per pound and the cost only increase by $???? per pound.
You own a firewood business that involves chopping down trees, sawing them into lumber and transporting to the market. You can cut the trees into 2X4s where they are cut down or after being transported to the market. Cutting down trees Sawing trees into lumber Transporting trees to $65 per ton the market $38 per ton $110 per ton Transporting 2X4s to $45 per ton the market a. Where should you locate the sawmill to minimize costs? Why? b. Where should you locate the sawmill if the price of lumber is $190 per ton? $215?
Saint John Mining operates several facilities. At one, a typical batch of an ore, Pryex, run through the processing plant yields three products: PX-10, PX-20, and PX-30. At the split-off point, the intermediate products cannot be sold without further processing. A typical batch of PX-10 sells for $110,000 after incurring additional processing costs of $20,000. PX-20 can be sold for $170,000 after additional processing costs of $44,000, and the PX-30 sells for $220,000 but requires additional processing costs of $76,000. The joint costs of processing the Pryex, including the cost of mining, are $240,000 per batch. Required: Use the estimated net realizable value method to allocate the joint processing costs and fill out the following table. PX-10 PX-20 PX-30 Estimated Sales Value at split-off Percent of total sales value at split-off % % % Cost-allocation
Underground Food Store has 3,000 pounds of raw beef nearing its expiration date. Each pound has a cost of $4.50. The beef could be sold "as is" for $3.00 per pound to the dog food processing plant, or roasted and sold in the deli. The cost of roasting the beef will be $2.80 per pound, and each pound could be sold for $6.50. What should be done with the beef, and why? If required, round final answers to two decimal places. The beef - processed further since the sales price by $ per pound and the cost only by per pound.
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Lois is planning to make fancy, multi-tiered wedding cakes for the next wedding season. To make the cakes, she must invest $2900 in some special baking tools. To promote her business, she also needs to spend $6265 to advertise in the newspaper. She estimates that supplies and materials for each cake will cost $690. She is planning to set the price for each cake at $925. (a) Compute the contribution margin. (b) Compute the contribution rate. (c) Compute the break-even point in units. (d) Compute the break-even point in sales dollars. (a) The contribution margin per unit is $ (Type a whole number.) (b) The contribution rate is%. (Round to two decimal places as needed.) (c) The break-even point is cakes. (Round up to the nearest unit.) (d) The break-even point in sales dollars is $. (Type a whole number.)
Ind
11.
Novak & Sons produces tomato juice and tomato puree from fresh tomatoes grown by local farmers. The company purchases large crates of tomatoes and then washes, sorts, scalds, peels, and crushes them, at which point the juice and the pulp are separately identifiable. Novak currently processes the pulp further to transform it into his great-great-grandmother's secret-recipe spaghetti sauce. The specifics on each of these products for one month are as follows. Joint processing costs Quantity of tomato juice produced Value of tomato juice Quantity of tomato puree produced Additional cost to make spaghetti sauce Final sales value of spaghetti sauce (a) Your answer is correct. Allocated joint costs LA $154,000 Juice 10,000 gallons Using the NRV method for allocating joint costs, specify how much joint cost will be allocated to the juice and to the puree/spaghetti sauce. (Round proportion to 4 decimal places, e.g. 0.2516 and final answers to 2 decimal places, e.g. 15.25.) $3 per gallon 16,000…

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