Introduction A cost incurred in a joint process is known as joint cost. To Determine 1. The cost allocations on a sales value basis to the three grades of peaches. 2. The Income Statement 3. Whether the delivery costs fit the definition of joint cost.

Question

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Answer 1

Question

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

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I am trying to find the accurate solution to this financial accounting problem with the correct explanation.

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Indira Products has provided the following data for the month of August: a. The balance in the Finished Goods inventory account at the beginning of the month was $65,000 and at the end of the month was $29,500. b. The cost of goods manufactured for the month was $210,000. c. The actual manufacturing overhead cost incurred was $71,800 and the manufacturing overhead cost applied to Work in Process was $75,200. d. The company closes out any underapplied or overapplied manufacturing overhead to the cost of goods sold. What is the adjusted cost of goods sold that would appear on the income statement for August?

Answer 2

Question

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

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Answer 3

Question

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

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Answer 4

Question

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

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Answer 5

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

Answer 6

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.

Answer 7

Chapter 24, Problem 5APSA

To determine

Introduction

A cost incurred in a joint process is known as joint cost.

To Determine
1. The cost allocations on a sales value basis to the three grades of peaches.
2. The Income Statement
3. Whether the delivery costs fit the definition of joint cost.

Answer 8

Expert Solution & Answer

Answer to Problem 5APSA

Solution

1. The cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Indirect cost	Allocated cost
No.1	450000	405000	194400
No.2	300000	405000	129600
No.3	187500	405000	81000
Total	937500		405000

Picking, Sorting and Grading
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	405000	97200
No.2	300000	405000	64800
No.3	187500	405000	40500
Total	937500		202500

4DQ
Grade	Sales Value	Indirect cost	Allocated Cost
No.1	450000	30000	18000
No.2	300000	12000
No.3	187500	37500	37500
Total	937500	67500	67500

2. The income statement is shown in the explanation section.

3. Yes, the delivery costs fits the definition of joint cost.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Explanation of Solution

Explanation

1. The calculation of the cost allocations are as follows:

Tree Pruning and Care
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	405000*48%=194400
No.2	300000	300000937500*100=32%	405000	405000*32%=129600
No.3	187500	187500937500*100=20%	405000	405000*20%=81000
Total	937500			405000

Picking, Sorting and Grading
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000937500*100=48%	405000	202500*48%=97200
No.2	300000	300000937500*100=32%	405000	202500*32%=64800
No.3	187500	187500937500*100=20%	405000	202500*20%=40500
Total	937500			202500

Delivery
Grade	Sales Value	Percentage of Allocation Base	Indirect cost	Allocated Cost
No.1	450000	450000/750000=60%	30000	30000*60%=18000
No.2	300000	300000/750000=40%	30000	30000*40%=12000
	750000
No.3	187500	187500/187500=100%	37500	37500*100%=37500
Total	937500			67500

2. The income statement is as follows:

GEORGIA ORCHIDS
INCOME STATEMENT
For the Year Ended December 31, 2015
Particulars	No.1	No.2	No.3	Combined
Sales (A)	450000	300000	187500	937500

Less Costs
Tree pruning and care	194400	129600	81000	405000
Picking, sorting and grading	97200	64800	40500	202500
Delivery costs	18000	12000	37500	67500
Total costs (B)	309600	206400	159000	675000
Net Income (A-B)	140400	93600	28500	262500

3. Yes. The delivery costs fits the definition of a joint cost as the No.1 & 2 grades of peaches are allocated delivery costs which are incurred on transporting them to the buyer as their destination is the same. No. 3 graded peaches delivery costs are directly linked with the produce going to the cannery.