Question

In: Accounting

Jackson Flocks Inc. processes Turkeys into three products for sale on the wholesale market: Breasts Smoked...

Jackson Flocks Inc. processes Turkeys into three products for sale on the wholesale market:

Breasts
Smoked legs and thighs
Whole Turkeys
Necks and wings for soup

The costs to get the products to the point where they can be separately identified total $10,000,000. Additional Information follows:

Product

Lbs. Produced

Cost after split-off

Selling price per pound

Breasts

1,000,000

$200,000

$2

Smoked legs and thighs

2,500,000

500,000

4

Whole Turkeys

2,000,000

425,000

3

Necks and wings

500,000

350,000

5

Feathers are sold at the split-off point as a by-product for $1,000,000 which lower the joint costs allocated.

Based on the information given for Jackson Flocks:

allocate the joint processing costs to the three products using:

Sales value at split-off method

Physical-measure method (volume in units)

NRV method

Prepare an analysis for Jackson Flocks that compares processing the smoked legs and thighs further, as it currently does, with selling them as a product immediately at split-off.

Assume Jackson flocks announced that in six months it will sell the legs and thighs at split-off due to increasing competitive pressure. Identify at least three types of likely behavior that will be demonstrated by the skilled labor in the brining and smoking process as a result of this announcement. Include in your discussion how this behavior could be influenced by management.

Solutions

Expert Solution

joint cost before sale of feathers = 10000000

joint cost 10000000
less sale of feathers 1000000
net joint cost 9000000
product units cost s.price/unit sales value= units * SP NRV = sales value - cost after split
breasts 1000000 200000 2 2000000 1800000
smoked legs 2500000 500000 4 10000000 9500000
turkeys 2000000 425000 3 6000000 5575000
necks and wings 500000 350000 5 2500000 2150000
allocation methd breast smoked legs turkeys neck and wings total
sales value 2000000 10000000 6000000 2500000 20500000
split of cost=                  sale value*jointcost/total sale value 87804.87805 439024.3902 263414.6341 109756.0976 900000
physical methodi.e units 1000000 2500000 2000000 500000 6000000
split of cost 150000 375000 300000 75000 900000
nrv 1800000 9500000 5575000 2150000 19025000
split of cost 85151.11695 449408.6728 263731.9317 101708.2786 900000

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Jackson Flocks Inc. processes Turkeys into three products for sale on the wholesale market: Breasts Smoked...
Jackson Flocks Inc. processes Turkeys into three products for sale on the wholesale market: Breasts Smoked legs and thighs Whole Turkeys Necks and wings for soup The costs to get the products to the point where they can be separately identified total $10,000,000. Additional Information follows: Product Lbs. Produced Cost after split-off Selling price per pound Breasts 1,000,000 $200,000 $2 Smoked legs and thighs 2,500,000 500,000 4 Whole Turkeys 2,000,000 425,000 3 Necks and wings 500,000 350,000 5 Feathers are...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a cookbook, a travel guide, and a handy speller. Each book sells for $10. The publishing company’s most recent monthly income statement is shown below. Product Line Total Company Cookbook Travel Guide Handy Speller Sales $ 300,000 $ 90,000 $ 150,000 $ 60,000 Expenses: Printing costs 102,000 27,000 63,000 12,000 Advertising 36,000 13,500 19,500 3,000 General sales 18,000 5,400 9,000 3,600 Salaries 33,000 18,000 9,000...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a cookbook, a travel guide, and a handy speller. Each book sells for $11. The publishing company’s most recent monthly income statement is shown below. Product line Total Company Cookbook Travel Guide Handy Speller Sales $ 350,000 $ 121,000 $ 166,000 $ 63,000 Expenses: Printing costs 117,000 42,000 64,500 10,500 Advertising 37,000 19,000 17,000 1,000 General sales 21,000 7,260 9,960 3,780 Salaries 32,000 17,000 10,500...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a cookbook, a travel guide, and a handy speller. Each book sells for $12. The publishing company’s most recent monthly income statement is given below: Product Line Total Company Cookbook Travel Guide Handy Speller   Sales $ 355,000 $ 125,000 $ 168,000 $ 62,000   Expenses:        Printing costs 118,000 43,000 66,000 9,000        Advertising 38,000 19,100 17,500 1,400        General sales 21,300 7,500 10,080 3,720        Salaries 33,000 18,000 10,600...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a...
Diversified Products, Inc., has recently acquired a small publishing company that offers three books for sale—a cookbook, a travel guide, and a handy speller. Each book sells for $13. The publishing company’s most recent monthly income statement is shown below. Product line Total Company Cookbook Travel Guide Handy Speller Sales $ 315,000 $ 96,000 $ 156,000 $ 63,000 Expenses: Printing costs 105,000 30,000 63,300 11,700 Advertising 39,000 13,800 21,000 4,200 General sales 18,900 5,760 9,360 3,780 Salaries 36,000 21,000 9,300...
KUMA makes three products X, Y, and Z. All three products must be offered for sale...
KUMA makes three products X, Y, and Z. All three products must be offered for sale each month in order to provide a complete market service. The products are fragile and their quality deteriorates rapidly once they are manufactured. The products are produced on two types of machine and worked on by a single grade of direct labour. Five direct employees are paid Ghc 8 per hour for a guaranteed minimum of 160 hours each per month. All of the...
You are the auditor for Drakey Wholesale Products Inc. As part of the audit of accounts...
You are the auditor for Drakey Wholesale Products Inc. As part of the audit of accounts receivable, your client has provided you an electronic file representing its accounts receivable as of its fiscal year-end (12/31/2017). The file includes the customer name, customer address, customer number, sales invoice number, sales invoice date, and amount. The total accounts receivable balance is material and historically you have confirmed certain customer accounts with a moderately decent response rate. Required: Answer the following questions independently...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local thrift shops. It sells the products at cost. The direct materials costs are zero, but the operation requires the use of direct labor and overhead. The company uses a process costing system and tracks the processing volume and costs incurred in each period. At the start of the current period, 200 towels were in process and were 60 percent complete. The costs incurred were...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local thrift shops. It sells the products at cost. The direct materials costs are zero, but the operation requires the use of direct labor and overhead. The company uses a process costing system and tracks the processing volume and costs incurred in each period. At the start of the current period, 250 towels were in process and were 60 percent complete. The costs incurred were...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local...
In its Department R, Recyclers, Inc., processes donated scrap cloth into towels for sale in local thrift shops. It sells the products at cost. The direct materials costs are zero, but the operation requires the use of direct labor and overhead. The company uses a process costing system and tracks the processing volume and costs incurred in each period. At the start of the current period, 200 towels were in process and were 60 percent complete. The costs incurred were...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT