Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
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Chapter 19, Problem 11E
Board-It, Inc., produces the following types of 2 × 4 × 10 wood boards: washed, stained, and pressure treated. These products are produced jointly until they are cut. One batch produces 45 washed boards, 35 stained boards, and 20 pressure treated boards. The joint production
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The joint process from which Ple'egrea, Inc. obtains both Nuts and Bolts has a total cost of $74,000 per batch. From each batch, 2,400 pounds of Nuts and 18,600 pounds of Bolts are obtained. These can be sold at the split-off point for $38 and $14 respectively. For product costing purposes Ple'egrea allocates joint costs using the relative sales value method.
The amount of joint cost allocated to Nuts would be, to the nearest dollar:
Pharoah Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint
products: Spock, Uhura, and Sulu. Each of these products can be sold as is, or each can be processed further and sold for a higher price.
The company incurs joint costs of $182,100 to process one batch of the raw material that produces the three joint products. The
following cost and sales information is available for one batch of each product.
Spock
Uhura
Sulu
Sales Value at
Split-Off Point
$209,600
299,800
455,800
Allocated
Joint Costs
$40,200
60,900
81,000
Cost to Process
Further
$109,700
84,700
250,200
Sales Value of
Processed Product
$300,900
400,600
799,600
Determine the incremental profit or loss that each of the three joint products. (Enter negative amounts using either a negative sign
preceding the number eg.-45 or parentheses e.g. (45))
RelyaTech Corporation makes two products, Light and Heavy. These two products emerge from a joint process.
Product Light has been allocated $19,300 of the total joint costs of $40,000.
A total of 2,600 units of product Light are produced from the joint process.
(ID#62183)
Product Light can be sold at the split-off point for $13 per unit, or it can be processed further for an additional total cost of $10,600 and then sold for $15 per
unit
Q) If product Light is processed further and sold, what would be the financial advantage (disadvantage) for RelyaTech Corporation compared with sale in its
unprocessed form directly after the split-off point?
Multiple Choice
($13,900)
($27300)
$(5,400)
$28,400
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Chapter 19 Solutions
Financial And Managerial Accounting
Ch. 19 - Why are support department costs difficult to...Ch. 19 - Why does support department cost allocation matter...Ch. 19 - What are some drawbacks of applying support...Ch. 19 - Why is the diect method of support department cost...Ch. 19 - How does management determine the order in which...Ch. 19 - Are large or small companies more likely to use...Ch. 19 - What is the main difference between the physical...Ch. 19 - When would management most likely use the net...Ch. 19 - What are the two most often used ways of...Ch. 19 - How can support department and joint cost...
Ch. 19 - Charlies Wood Works produces wood products (e.g.,...Ch. 19 - Bucknum Boys, Inc., produces hunting gear for buck...Ch. 19 - Brewster Toymakers Inc. produces toys for...Ch. 19 - Prob. 4BECh. 19 - Garys Grooves Co. produces two types of carving...Ch. 19 - Man OFort Inc. produces two different styles of...Ch. 19 - Yo-Down Inc. produces yogurt. Information related...Ch. 19 - Snowy River Stallion Inc. produces horse and...Ch. 19 - Blue Africa Inc. produces laptops and desktop...Ch. 19 - Christmas Timber, Inc., produces Christmas trees....Ch. 19 - Crystal Scarves Co. produces winter scarves. The...Ch. 19 - Davis Snowflake Co. produces Christmas stockings...Ch. 19 - Becker Tabletops has two support departments...Ch. 19 - Becker Tabletops has two support departments...Ch. 19 - Becker Tabletops has two support departments...Ch. 19 - Support department cost allocation comparison...Ch. 19 - Board-It, Inc., produces the following types of 2 ...Ch. 19 - Prob. 12ECh. 19 - Joint cost allocation market value at split-off...Ch. 19 - Joint cost allocation net realizable value method...Ch. 19 - Big Als Inc. produces and sells various cuts of...Ch. 19 - Gordons Smoothie Stand makes three types of...Ch. 19 - Joint cost allocation-market value at split-off...Ch. 19 - Joint cost allocation net realizable value method...Ch. 19 - Support department cost allocation Blue Mountain...Ch. 19 - Support activity cost allocation Jakes Gems mines...Ch. 19 - Joint cost allocation Lovely Lotion Inc. produces...Ch. 19 - Joint cost allocation Florissas Flowers jointly...Ch. 19 - Support department cost allocation Hooligan...Ch. 19 - Support activity cost allocation Kizzles Crepes...Ch. 19 - Joint cost allocation McKenzies Soap Sensations,...Ch. 19 - Joint cost allocation Rosies Roses produces three...Ch. 19 - Analyze Milkrageous, Inc. Milkragcous, Inc., a...Ch. 19 - Analyze Horsepower Hookup, Inc. Horsepower Hookup,...Ch. 19 - Prob. 3MADCh. 19 - Analyze Williams Ball Jersey Shop Williams Ball ...Ch. 19 - Prob. 1TIFCh. 19 - Prob. 3TIFCh. 19 - Logo Inc. has two data services departments...Ch. 19 - Adam Corporation manufactures computer tables and...Ch. 19 - Breegle Company produces three products (B-40,...Ch. 19 - Tucariz Company processes Duo into two joint...
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- Oakes Inc. manufactured 40,000 gallons of Mononate and 60,000 gallons of Beracyl in a joint production process, incurring 250,000 of joint costs. Oakes allocates joint costs based on the physical volume of each product produced. Mononate and Beracyl can each be sold at the split-off point in a semifinished state or, alternatively, processed further. Additional data about the two products are as follows: An assistant in the companys cost accounting department was overheard saying ...that when both joint and separable costs are considered, the firm has no business processing either product beyond the split-off point. The extra revenue is simply not worth the effort. Which of the following strategies should be recommended for Oakes?arrow_forwardBreegle Company produces three products (B-40, J-60, and H-102) from a single process. Breegle uses the physical volume method to allocate joint costs of 22,500 per batch to theproducts. Based on the following information, which product(s) should Breegle continue toprocess after the split-off point in order to maximize profit? a. B-40 only b. J-60 only c. H-102 only d. B-40 and H-102 onlyarrow_forwardTucariz Company processes Duo into two joint products, Big and Mini. Duo is purchased in 1,000-gallon drums for 2.000. Processing costs are 3,000 to process the 1,000 gallons of Duointo 800 gallons of Big and 200 gallons of Mini. The selling price is 9 per gallon for Big and4 per gallon for Mini. If the physical units method is used to allocate joint costs to the finalproducts, the total cost allocated to produce Mini is: a. 500. b. 4,000. c. 1,000. d. 4,500.arrow_forward
- Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were 50,000, and 14,000 units of overs and 36,000 units of unders were produced. Separable processing costs beyond the split-off point were as follows: overs, 18,000; unders, 23,040. Overs sell for 2.00 per unit; unders sell for 3.14 per unit. Required: 1. Allocate the 50,000 joint costs using the estimated net realizable value method. 2. Suppose that overs could be sold at the split-off point for 1.80 per unit. Should Pacheco sell overs at split-off or process them further? Show supporting computations.arrow_forwardCrane Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint products: Spock, Uhura, and Sulu. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of $179,800 to process one batch of the raw material that produces the three joint products. The following cost and sales information is available for one batch of each product. Spock Uhura Sulu Incremental profit (loss) Sales Value at Split-Off Point Spock Uhura $209,700 Sulu 300,900 454,100 Save for Later $ Determine the incremental profit or loss that each of the three joint products. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses eg. (45).) sold as is Allocated Joint Costs $39.700 60,700 79,400 Spock process further Cost to Process Further $110,400 process further 85,100 249,700 $ Sales Value of Processed Product Indicate whether each of the…arrow_forwardCrane's woodworking business produces two products from its joint process: one main product (sanded and finished trim pieces) and one by-product (sawdust/shavings). The joint process has a cost of $31,000, which results in trim pieces worth $47,000 and sawdust/shavings that can be sold for $2,800. If Crane uses the production method to account for by-products, determine how much of the joint process cost will be allocated to each product. In other words, how much inventory cost will be recorded for each product? Main product By-product Allocated joint costs $arrow_forward
- Joint Cost Allocation—Physical Units Method Board-It, Inc., produces the following types of 2 × 4 × 10 wood boards: washed, stained, and pressure treated. These products are produced jointly until they are cut. One batch produces 45 washed boards, 35 stained boards, and 20 pressure treated boards. The joint production process costs a total of $710 per batch. Using the physical units method, allocate the joint production cost to each product. Round your answers to two decimal places.arrow_forwardJoint Cost Allocation—Physical Units Method Board-It, Inc., produces the following types of 2 × 4 × 10 wood boards: washed, stained, and pressure treated. These products are produced jointly until they are cut. One batch produces 45 washed boards, 35 stained boards, and 20 pressure treated boards. The joint production process costs a total of $710 per batch. Using the physical units method, allocate the joint production cost to each product. Round your answers to two decimal places. Joint Product Allocation Washed $ Stained Pressure treated Totals $arrow_forwardKirk Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint products: Spock, Uhura, and Sulu. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of $178,800 to process one batch of the raw material that produces the three joint products. The following cost and sales information is available for one batch of each product. Spock Uhura Sulu Sales Value at Split-Off Point $211,000 299,200 455,600 Allocated Joint Costs Incremental profit (loss) $ $39,700 59,800 79,300 Cost to Process Further $110,800 Spock 85,200 250,000 Sales Value of Processed Product $300,100 400,200 Determine the incremental profit or loss that each of the three joint products. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) 800,800 Uhura Suluarrow_forward
- Nash's woodworking business produces two products from its joint process: one main product (sanded and finished trim pieces) and one by - product (sawdust/shavings). The joint process has a cost of $29,000, which results in trim pieces worth $52,000 and sawdust/shavings that can be sold for $2,800. If Nash uses the production method to account for by - products, determine how much of the joint process cost will be allocated to each product. In other words, how much inventory cost will be recorded for each product? eTextbook and Mediaarrow_forwardKirk Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint products: Spock, Uhura, and Sulu. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of $178,600 to process one batch of the raw material that produces the three joint products. The following cost and sales information is available for one batch of each product. Sales Value atSplit-Off Point AllocatedJoint Costs Cost to ProcessFurther Sales Value ofProcessed Product Spock $209,500 $39,200 $110,100 $300,900 Uhura 299,900 59,100 85,100 400,900 Sulu 454,000 80,300 249,500 800,700 Determine the incremental profit or loss that each of the three joint products. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Spock Uhura Sulu…arrow_forwardKirk Minerals processes materials extracted from mines. The most common raw material that it processes results in three joint products: Spock, Uhura, and Sulu. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of $179,400 to process one batch of the raw material that produces the three joint products. The following cost and sales information is available for one batch of each product. Sales Value atSplit-Off Point AllocatedJoint Costs Cost to ProcessFurther Sales Value ofProcessed Product Spock $209,700 $40,000 $109,600 $300,900 Uhura 300,000 60,200 84,900 399,900 Sulu 455,500 79,200 249,500 800,500 Determine the incremental profit or loss that each of the three joint products. Spock Uhura Sulu Incremental profit (loss) $ $ $ Indicate whether each of the three joint products should be sold as…arrow_forward
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