Question 7 Quality Chicken grows and processes chickens. Each chicken is disassembled into five main parts. Information pertaining to production in July 2020 follows: Parts Pounds of Product Selling Price per Pound Breasts 100 $0.55 Wings 20 $0.20 Thighs 40 $0.35 Bones 80 $0.10 Feathers 10 $0.05 Joint cost of production in July 2020 was $50. A special shipment of 40 pounds of breasts and 15 pounds of wings has been destroyed in a fire. Quality Chicken’s insurance policy provides reimbursement for the cost of the items destroyed. The insurance company permits Quality Chicken to use a joint-cost-allocation method. The split off point is assumed to be at the end of the production process. What would be th
Quality Chicken grows and processes chickens. Each chicken is disassembled into five main parts. Information pertaining to production in July 2020 follows:
Parts Pounds of Product Selling Price per Pound
Breasts 100 $0.55
Wings 20 $0.20
Thighs 40 $0.35
Bones 80 $0.10
Feathers 10 $0.05
Joint cost of production in July 2020 was $50. A special shipment of 40 pounds of breasts and 15 pounds of wings has been destroyed in a fire. Quality Chicken’s insurance policy provides reimbursement for the cost of the items destroyed. The insurance company permits Quality Chicken to use a joint-cost-allocation method. The split off point is assumed to be at the end of the production process. What would be the cost of the special shipment destroyed using the physical-measure method?
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