Upton Company produces two main products and a by-product out of a joint process. The ratio of output quantities to input quantities of direct material used in the joint process remains consistent from month to month. Upton has employed the physical quantities method to allocate joint production costs to the two main products. The net realizable value of the by-product is used to reduce the joint production costs before the joint costs are allocated to the main products. Data regarding Upton's operations for the current month are presented in the chart below. During the month, Upton incurred joint production costs of $4,213,200. The main products are not marketable at the split-off point and, thus, have to be processed further. First Main Second Main Product Product By-product Monthly output in pounds 114,000 180,000 78,000 Selling Price per pound $ 40 $ 14 $ 2 Separable process costs $684,000 $792,000 The amount of joint production cost that Upton would allocate to the Second Main Product by using the physical quantities method to allocate joint production costs would be: Multiple Choice $2,184,000. $2,244,000. O $2,579,510. $2,484,000.

Upton Company produces two main products and a by-product out of a joint process. The ratio of output quantities to input quantities of direct material used in the joint process remains consistent from month to month. Upton has employed the physical quantities method to allocate joint production costs to the two main products. The net realizable value of the by-product is used to reduce the joint production costs before the joint costs are allocated to the main products. Data regarding Upton's operations for the current month are presented in the chart below. During the month, Upton incurred joint production costs of $4,213,200. The main products are not marketable at the split-off point and, thus, have to be processed further. First Main Second Main Product Product By-product Monthly output in pounds 114,000 180,000 78,000 Selling Price per pound $ 40 $ 14 $ 2 Separable process costs $684,000 $792,000 The amount of joint production cost that Upton would allocate to the Second Main Product by using the physical quantities method to allocate joint production costs would be: Multiple Choice $2,184,000. $2,244,000. O $2,579,510. $2,484,000.

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Description: Upton Company produces two main products and a by-product out of a joint process. The ratio of output quantities to input quantities of direct material used in the joint process remains consistent from month to month.Upton has employed the physical

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 10CE: A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each...

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