Boissons Company produces four solvents from the same process: C1RT, D4GH, E7TY,

Question

Boissons Company produces four solvents from the same process: C1RT, D4GH, E7TY, and G98P. Joint product costs are $156,000. (Round all answers to the nearest dollar.) Barrels Sales price per barrel at split-off Disposal cost per barrel at split-off Further processing costs C1RT 500 $10.00 $6.50 $2.00 D4GH 1,000 8.00 4.00 2.50 E7TY 1,500 11.00 7.00 4.00 G98P 2,000 15.00 9.50 4.50 If Boissons sells the products after further processing, the following disposal costs will be incurred: C1RT, $2.50; D4GH, $1.00; E7TY, $3.50; G98P, $6.00. Using a physical measurement method, how much joint cost are allocated to each of the four solvents? (C1RT, D4GH, E7TY & G98P)

Explanation / Answer

Allocation of joint product costs using physical measurement method:

Solvent Total C1RT D4GH E7TY G98P Barrels 500 1000 1500 2000 5000 Percent to total barrels 10% 20% 30% 40% 100% Joint product costs $ 15600 31200 46800 62400 156000 (156000 x 10%) (156000 x 20%) (156000 x 30%) (156000 x 40%)

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---