Pirate Seafood Company purchases lobsters and processes them into tails and flak
ID: 2416816 • Letter: P
Question
Pirate Seafood Company purchases lobsters and processes them into tails and flakes. It sells the lobster tails for $19.90 per pound and the flakes for $15.00 per pound. On average, 100 pounds of lobster are processed into 59 pounds of tails and 24 pounds of flakes, with 17 pounds of waste. Assume that the company purchased 3,400 pounds of lobster for $4 per pound and processed the lobsters with an additional labor cost of $6,800. No materials or labor costs are assigned to the waste. If 1,868 pounds of tails and 730 pounds of flakes are sold, calculate the allocated cost of the sold items and the allocated cost of the ending inventory. The company allocates joint costs on a value basis. (Round your answers to nearest whole number. Round cost per pound answers to 2 decimal places.)
Please answer in this format.
yield per 3400 lb.purhcase market value per 3400lb purchase allocation base percent of allocation base xIndirect cost allocated cost numerator denominator % of Toal lobster tails lobster flakes totals what is the allocated cost of the sold items? cost per pound pounds sold cost of goods sold lobster tails lobster flakes totals what is the allocated cost of the ending inventory cost per pound pounds in ending invent. cost of ending inventory lobster tails lobster flakes totalsExplanation / Answer
The company is not attributing the material and labor cost to the waste pounds. therefore the material and labor cost has been attributed to the Tails and Flakes on the basis of their sales value.
Cost of direct materials of 3,400lbs @ $4 each 13600 Allocation of direct material on value basis (77%:23%) Tails Flakes Direct material($13,600) $ 10,472.00 $ 3,128.00 Allocated labor cost $ 5,204.28 $ 1,595.72 Cost of production $ 15,676.28 $ 4,723.72 Total pounds produced 2006 816 Cost per pound $ 7.81 $ 5.79