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Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three p as follows: Product L-Ten Triol Pioze Required: Grades L-Ten Triol Pioze Grades L-Ten Triol Total Pioze Gallons 3,600 4,100 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost Allocation Total 2,100 Further Processing Cost per Gallon $0.50 1.00 1.40 2. What if it cost $2.00 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the alle costs to the nearest dollar. Joint Cost Eventual Market Price per Gallon $2.60 Allocation 5.40 0000 6.60

Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three p as follows: Product L-Ten Triol Pioze Required: Grades L-Ten Triol Pioze Grades L-Ten Triol Total Pioze Gallons 3,600 4,100 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost Allocation Total 2,100 Further Processing Cost per Gallon $0.50 1.00 1.40 2. What if it cost $2.00 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the alle costs to the nearest dollar. Joint Cost Eventual Market Price per Gallon $2.60 Allocation 5.40 0000 6.60

Cornerstones of Cost Management (Cornerstones Series)
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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Allocating Joint Costs Using the Net Realizable Value Method

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Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows: Product L-Ten Triol Pioze Grades L-Ten Triol Pioze Grades L-Ten Triol Total Pioze Gallons 3,600 4,100 2,100 Total Further Processing Cost per Gallon Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost $0.50 1.00 1.40 Allocation 2. What if it cost $2.00 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. $ Joint Cost Eventual Market Price per Gallon Allocation $2.60 5.40 6.60
Transcribed Image Text:Allocating Joint Costs Using the Net Realizable Value Method A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows: Product L-Ten Triol Pioze Grades L-Ten Triol Pioze Grades L-Ten Triol Total Pioze Gallons 3,600 4,100 2,100 Total Further Processing Cost per Gallon Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. Joint Cost $0.50 1.00 1.40 Allocation 2. What if it cost $2.00 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products? Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar. $ Joint Cost Eventual Market Price per Gallon Allocation $2.60 5.40 6.60
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