LO.3 (Sell or process further) In a joint process, Sylvia's Styles produces precut fabrics for three products: dresses, jackets, and blouses. Joint cost is allocated on the basis of rela- tive sales value at split-off. The company can choose to process each of the products fur- ther rather than sell the fabric at split-off. Information related to these products follows. Dresses Jackets Blouses Total Number of units produced 10,000 16,000 6,000 32,000 Joint cost allocated $174,000 $360,000 Sales values at split-of point Additional costs of processing further $80,000 $600,000 $26,000 $20,000 $78,000 $124,000 Sales values after all processing $300,000 $268,000 $210,000 $7780 a. What amount of joint cost should be allocated to jackets and blouses? b. What are the sales values at the split-off point for dresses and jackets? c. Should any of the products be processed beyond the split-off point? Show computations. d. If 4,000 jackets are processed further and sold at the regular selling price, what is the gross profit on the sale?

LO.3 (Sell or process further) In a joint process, Sylvia's Styles produces precut fabrics for three products: dresses, jackets, and blouses. Joint cost is allocated on the basis of rela- tive sales value at split-off. The company can choose to process each of the products fur- ther rather than sell the fabric at split-off. Information related to these products follows. Dresses Jackets Blouses Total Number of units produced 10,000 16,000 6,000 32,000 Joint cost allocated $174,000 $360,000 Sales values at split-of point Additional costs of processing further $80,000 $600,000 $26,000 $20,000 $78,000 $124,000 Sales values after all processing $300,000 $268,000 $210,000 $7780 a. What amount of joint cost should be allocated to jackets and blouses? b. What are the sales values at the split-off point for dresses and jackets? c. Should any of the products be processed beyond the split-off point? Show computations. d. If 4,000 jackets are processed further and sold at the regular selling price, what is the gross profit on the sale?

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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