nature’s Garden Inc., produces wood chips, wood pulp, and mulch. These products are produced through harvesting trees and sending the logs through a wood chipper machine. One batch of logs produces 20,304 cubic yards of wood chips, 14,100 cubic yards of mulch, and 9,024 cubic yards of wood pulp. The joint production process costs a total of $32,000 per batch. After the split-off point, wood chips are immediately sold for $ 25.00 per cubic yard while wood pulp and mulch are processed further. The market value of the wood pulp and mulch at the split-off point is estimated to be $22.00 and $24.00 yard, after which it is sold for $ 30.00 per cubic yard. The additional production process of the mulch costs $ 4.00 per cubic yard, after which it is sold for $ 32.00 per cubic yard. Requirement: Allocate the joint costs of production to each product using the net realizable value method. Please use the Excel template provided to assist you in solving this problem.
nature’s Garden Inc., produces wood chips, wood pulp, and mulch. These products are produced through harvesting trees and sending the logs through a wood chipper machine. One batch of logs produces 20,304 cubic yards of wood chips, 14,100 cubic yards of mulch, and 9,024 cubic yards of wood pulp. The joint production
Requirement:
Allocate the joint costs of production to each product using the net realizable value method. Please use the Excel template provided to assist you in solving this problem.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 3 images
