Question

#1-Physical Units Method

Alomar Company manufactures four products from a joint production process: barlon, selene, plicene, and corsol. The joint costs for one batch are as follows:

Direct materials	$73,968
Direct labor	36,296
Overhead	22,612

At the split-off point, a batch yields 1,135 barlon, 2,993 selene, 2,580 plicene, and 3,612 corsol. All products are sold at the split-off point: barlon sells for $12 per unit, selene sells for $19 per unit, plicene sells for $27 per unit, and corsol sells for $37 per unit.

Required:

1. Allocate the joint costs using the physical units method. If required, round your percentage allocation to four decimal places and round allocated costs to the nearest dollar. Note: The total of the allocated cost does not equal to the one provided in the question data due to rounding error.

	Allocated Joint Cost
Barlon	$______
Selene	_______
Plicene	_______
Corsol	________
Total	$132,876

2. Suppose that the products are weighted as shown below:

Barlon	1.4
Selene	2.2
Plicene	1.5
Corsol	2.6

Allocate the joint costs using the weighted average method. If required, round your percentage allocation to four decimal places and round allocated costs to the nearest dollar.

	Allocated Joint Cost
Barlon	$______
Selene	_______
Plicene	_______
Corsol	_______
Total	$132,876

__________________________________________________________________________________________________________________________

#2-Sales-Value-at-Split-off Method

Alomar Company manufactures four products from a joint production process: barlon, selene, plicene, and corsol. The joint costs for one batch are as follows:

Direct materials	$69,000
Direct labor	34,000
Overhead	27,000

At the split-off point, a batch yields 1,700 barlon, 2,300 selene, 2,200 plicene, and 3,300 corsol. All products are sold at the split-off point: barlon sells for $18 per unit, selene sells for $22 per unit, plicene sells for $29 per unit, and corsol sells for $36 per unit.

Required:

Allocate the joint costs using the sales-value-at-split-off method. If required, round allocation rates to four decimal places and round the final allocations to the nearest dollar.

	Allocated Joint Cost
Barlon	$_______________
Selene	______________
Plicene	_____________
Corsol	____________
Total	$______________

(Note: The total of the allocated cost may not equal actual total costs to due to rounding.)

Answer 1

	#1-Physical Units Method
	Joint costs to be allocated:
			$
	Direct materials		$73,968
	Direct labor		36,296
	Overhead		22,612
	Total		$132,876
1		Units	Allocation %	Allocated joint cost
		a	b=a/10320	132876*b
	Barlon	1135	10.9981%	14614
	Selene	2993	29.0019%	38537
	Plicene	2580	25.0000%	33219
	Corsol	3612	35.0000%	46507
	Total	10320		132876
2		Units	Weight	Weighted units	Cost per unit	Allocated joint cost
		a	b	c=a*b	d	c*d
	Barlon	1135	1.4	1589	6.119	9723
	Selene	2993	2.2	6585	6.119	40291
	Plicene	2580	1.5	3870	6.119	23681
	Corsol	3612	2.6	9391	6.119	57465
	Total			21435		131160
	(The total of the allocated cost may not equal actual total costs to due to rounding)
	Cost per unit=Joint cost to be allocated/Total weighted units=132876/21435=6.1190
	#2-Sales-Value-at-Split-off Method
	Joint costs to be allocated:
			$
	Direct materials		$69,000
	Direct labor		34,000
	Overhead		27,000
	Total		$130,000
		Units	Selling price per unit at split-off	Sales value at split-off	Allocation %	Allocated joint cost
		a	b	c=a*b	d=c/263800	130000*d
	Barlon	1700	18	30600	11.5997%	15080
	Selene	2300	22	50600	19.1812%	24936
	Plicene	2200	29	63800	24.1850%	31440
	Corsol	3300	36	118800	45.0341%	58544
	Total			263800		130000