The Marshall Company has a joint production process that produces two joint products and a by-product. The joint products are Ying and Yang, and the by-product is Bit. Marshall accounts for the costs of its products using the net realizable value method. The two joint products are processed beyond the split-off point, incurring separable processing costs. There is a $2,300 disposal cost for the by-product. A summary of a recent month’s activity at Marshall is shown below: Ying Yang Bit Units sold 115,000 92,000 23,000 Units produced 115,000 92,000 23,000 Separable processing costs—variable $ 322,000 $ 98,000 $ — Separable processing costs—fixed $ 23,000 $ 17,000 $ — Sales price $ 6.00 $ 12.50 $ 1.50 Total joint costs for Marshall in the recent month are $302,200, of which $129,946 is a variable cost. Required: Calculate the manufacturing cost per unit for each of the three products. Note: Round manufacturing cost per unit answers to 2 decimal places. Calculate the total gross margin for each product.
The Marshall Company has a joint production process that produces two joint products and a by-product. The joint products are Ying and Yang, and the by-product is Bit. Marshall accounts for the costs of its products using the net realizable value method. The two joint products are processed beyond the split-off point, incurring separable processing costs. There is a $2,300 disposal cost for the by-product. A summary of a recent month’s activity at Marshall is shown below: Ying Yang Bit Units sold 115,000 92,000 23,000 Units produced 115,000 92,000 23,000 Separable processing costs—variable $ 322,000 $ 98,000 $ — Separable processing costs—fixed $ 23,000 $ 17,000 $ — Sales price $ 6.00 $ 12.50 $ 1.50 Total joint costs for Marshall in the recent month are $302,200, of which $129,946 is a variable cost. Required: Calculate the manufacturing cost per unit for each of the three products. Note: Round manufacturing cost per unit answers to 2 decimal places. Calculate the total gross margin for each product.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 4CMA: Oakes Inc. manufactured 40,000 gallons of Mononate and 60,000 gallons of Beracyl in a joint...
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Question
The Marshall Company has a joint production process that produces two joint products and a by-product. The joint products are Ying and Yang, and the by-product is Bit. Marshall accounts for the costs of its products using the net realizable value method. The two joint products are processed beyond the split-off point, incurring separable processing costs. There is a $2,300 disposal cost for the by-product. A summary of a recent month’s activity at Marshall is shown below:
| Ying | Yang | Bit | |
|---|---|---|---|
| Units sold | 115,000 | 92,000 | 23,000 |
| Units produced | 115,000 | 92,000 | 23,000 |
| Separable processing costs—variable | $ 322,000 | $ 98,000 | $ — |
| Separable processing costs—fixed | $ 23,000 | $ 17,000 | $ — |
| Sales price | $ 6.00 | $ 12.50 | $ 1.50 |
Total joint costs for Marshall in the recent month are $302,200, of which $129,946 is a variable cost.
Required:
-
Calculate the manufacturing cost per unit for each of the three products.
Note: Round manufacturing cost per unit answers to 2 decimal places.
-
Calculate the total gross margin for each product.
Expert Solution
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