Question
In: Accounting
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are $330,000 for a standard production run that generates 100,000 pints of Smooth Skin and 180,000 pints of Silken Skin. Smooth Skin sells for $2.80 per pint, while Silken Skin sells for $5.90 per pint. (Do not round intermediate calculations. Round final answers to nearest whole dollar amounts.)
Required:
1. Assuming that both products are sold at the split-off point, how
much of the joint cost of each production run is allocated to
Smooth Skin using the relative sales value method?
2. If no separable costs are incurred after the split-off point,
how much of the joint cost of each production run is allocated to
Silken Skin using the physical measure method?
3. If separable processing costs beyond the split-off point are
$1.40 per pint for Smooth Skin and $1.00 per pint for Silken Skin,
how much of the joint cost of each production run is allocated to
Silken Skin using a net realizable value method?
4. If separable processing costs beyond the split-off point are
$1.40 per pint for Smooth Skin and $1.00 per pint for Silken Skin,
how much of the joint cost of each production run is allocated to
Smooth Skin using a physical measure method?
Solutions
Expert Solution
| part-1: Allocation Of Joint Cost - Sale Value At Split Off Point | |||
| Particulars | Pints of Smooth Skin | Pints of Silken Skin | Tototal |
| Sale Value at Split off point | $280,000 | $1,062,000 | $1,342,000 |
| (100000*2.80) | (180000*5.90) | ||
| Allocation of Joint Cost | $68,852 | $261,148 | $330,000 |
| (280000/1342000)*330000 | (1062000/1342000)*330000 | ||
| Part-2: Allocation of Joint Cost - Physical measure method | |||
| Particulars | Pints of Smooth Skin | Pints of Silken Skin | Tototal |
| Output at split off point | 100000 | 180000 | 280000 |
| Allocation of Joint Cost | $117,857 | $212,143 | $330,000 |
| (100000/280000)*330000 | (180000/280000)*330000 | ||
| Part-3: Allocation of Joint Cost- NRV Method | |||
| Particulars | Pints of Smooth Skin | Pints of Silken Skin | Tototal |
| Sale Value after further processing | $280,000 | $1,062,000 | $1,342,000 |
| Less: Further Processing Cost | $140,000 | $504,000 | $644,000 |
| (100000*1.40) | (180000*2.80) | ||
| Net Realisable Value | $140,000 | $558,000 | $698,000 |
| Allocation of Joint Cost | $66,189 | $263,811 | $330,000 |
| (140000/698000)*330000 | (558000/698000)*330000 | ||
| Part-4: Allocation of Joint Cost - Physical measure method | |||
| Particulars | Pints of Smooth Skin | Pints of Silken Skin | Tototal |
| Output at split off point | 100000 | 180000 | 280000 |
| Allocation of Joint Cost | $117,857 | $212,143 | $330,000 |
| (100000/280000)*330000 | (180000/280000)*330000 | ||
ekkarill92 answered 1 year agoRelated Solutions
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$350,000 for a standard production run that generates 160,000 pints
of Smooth Skin and 120,000 pints of Silken Skin. Smooth Skin sells
for $3.30 per pint, while Silken Skin sells for $4.90 per pint.
(Round intermediate calculations to 2 decimal places and
final answers to nearest whole dollar amounts.)
Required:
1. Assuming that both products are sold at...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$330,000 for a standard production run that generates 100,000 pints
of Smooth Skin and 180,000 pints of Silken Skin. Smooth Skin sells
for $2.80 per pint, while Silken Skin sells for $5.90 per pint.
(Round intermediate calculations to 2 decimal places and
final answers to nearest whole dollar amounts.)
Required:
1. Assuming that both products are sold at...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$360,000 for a standard production run that generates 240,000 pints
of Smooth Skin and 110,000 pints of Silken Skin. Smooth Skin sells
for $3.10 per pint, while Silken Skin sells for $5.10 per pint.
(Round intermediate calculations to 2 decimal places and final
answers to nearest whole dollar amounts.) Required: 1. Assuming
that both products are sold at the...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$360,000 for a standard production run that generates 170,000 pints
of Smooth Skin and 300,000 pints of Silken Skin. Smooth Skin sells
for $3.20 per pint, while Silken Skin sells for $5.20 per pint.
(Do not round intermediate calculations. Round final
answers to nearest whole dollar amounts.)
Required:
3. If separable processing costs beyond the split-off point are...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$300,000 for a standard production run that generates 170,000 pints
of Smooth Skin and 130,000 pints of Silken Skin. Smooth Skin sells
for $3.40 per pint, while Silken Skin sells for $4.90 per pint. (Do
not round intermediate calculations. Round final answers to nearest
whole dollar amounts.) Required: 1. Assuming that both products are
sold at the split-off point,...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$390,000 for a standard production run that generates 270,000 pints
of Smooth Skin and 290,000 pints of Silken Skin. Smooth Skin sells
for $2.30 per pint, while Silken Skin sells for $4.50 per pint. (Do
not round intermediate calculations. Round final answers to nearest
whole dollar amounts.) Required: 1. Assuming that both products are
sold at the split-off point,...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$430,000 for a standard production run that generates 200,000 pints
of Smooth Skin and 170,000 pints of Silken Skin. Smooth Skin sells
for $4.00 per pint, while Silken Skin sells for $5.20 per pint. (Do
not round intermediate calculations. Round final answers to nearest
whole dollar amounts.)
Required: 1. Assuming that both products are sold at the
split-off point,...
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process....
Choi Company manufactures two skin care lotions, Smooth Skin and
Silken Skin, from a joint process. The joint costs incurred are
$310,000 for a standard production run that generates 180,000 pints
of Smooth Skin and 280,000 pints of Silken Skin. Smooth Skin sells
for $3.60 per pint, while Silken Skin sells for $5.10 per pint.
(Do not round intermediate calculations. Round final
answers to nearest whole dollar amounts.)
Required:
1. Assuming that both products are sold at the split-off...
Garden of Eden Company manufactures two products, Brights and Dulls, from a joint process. A production...
Garden of Eden Company manufactures two products, Brights and
Dulls, from a joint process. A production run costs $50,000 and
results in 250 units of Brights and 1,000 units of Dulls. Both
products must be processed past the split-off point, incurring
separable costs for Brights of $60 per unit and $40 per unit for
Dulls. The market price is $250 for Brights and $200 for Dulls.
1. What is the amount of joint costs allocated to Dulls using
the physical...
Benjamin Company produces two products from a joint process: X and Z. Joint processing costs for...
Benjamin Company produces two products from a joint process: X
and Z. Joint processing costs for this production cycle are
$8,000.
Yards
Sales price
per yard at
split-off
Disposal
cost per yard at
split-off
Further
processing
per yard
Final sale
price per
yard
X 1,500 $6.00 $3.50 $1.00 $7.50
Z 2,200 9.00 5.00 3.00 11.25
If X and Z are processed further, no disposal costs will be
incurred or such costs will be borne by the buyer. Refer to
Benjamin...
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