Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total jo
ID: 2462447 • Letter: A
Question
Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total joint costs are $390,000. The sales value at split-off was $430,000 for 4,800 units of product XX-1 and $170,000 for 1,800 units of product XX-2.
Assuming that total joint costs are allocated using the net realizable value at split-off approach, what amount of the joint costs was allocated to product XX-1?
Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total joint costs are $390,000. The sales value at split-off was $430,000 for 4,800 units of product XX-1 and $170,000 for 1,800 units of product XX-2.
Explanation / Answer
amount of the joint costs was allocated to product XX-1= Total joint costs are $390,000/430,000+170,000*430,000=$279,500.