Use the following information: Department Cost Percentage Service Provided to S1 S2 P1 P2 Service 1 (S1) $ 118,000 0% 45% 35% 20% Service 2 (S2) 50,000 20 0 20 60 Production 1 (P1) 405,000 Production 2 (P2) 276,000 Total $ 849,000 a. What percentage of S1’s costs is allocated to P1 and to P2 under the direct method? (Round your answer to the nearest fraction.) b. What percentage of S2’s costs is allocated to P1 and to P2 under the direct method? (Round your answer to the nearest fraction.)
Use the following information:
| Department | Cost |
Percentage Service Provided to |
|||
|---|---|---|---|---|---|
| S1 | S2 | P1 | P2 | ||
| Service 1 (S1) | $ 118,000 | 0% | 45% | 35% | 20% |
| Service 2 (S2) | 50,000 | 20 | 0 | 20 | 60 |
| Production 1 (P1) | 405,000 | ||||
| Production 2 (P2) | 276,000 | ||||
| Total | $ 849,000 |
a. What percentage of S1’s costs is allocated to P1 and to P2 under the direct method? (Round your answer to the nearest fraction.)
b. What percentage of S2’s costs is allocated to P1 and to P2 under the direct method? (Round your answer to the nearest fraction.)
Question 2.
The following information relates to a joint production process for three products, with a total joint production cost of $175,000. There are no separable
| Product | Sales Value at Split-Off | Units at Split-Off |
|---|---|---|
| 1 | $ 227,500 | 680 |
| 2 | 87,500 | 1,020 |
| 3 | 35,000 | 1,700 |
| $ 350,000 | 3,400 |
a. What percentage of joint cost is allocated to each of the three products using the sales value at split-off method?
b. What percentage of joint cost is allocated to each of the three products using the physical units method?
c. Assume that the total sales value at the split-off point for product 1 is $87,500 instead of $227,500 and the sales value of product 3 is $3,500 instead of $35,000. Assume also that, because of its relatively low sales value, the firm treats product 3 as a by-product and uses the asset recognition method for accounting for by-products. What amount of joint cost would be allocated to the products using the sales value at split-off method?
d. Assume that the total sales value at the split-off point for product 1 is $87,500 instead of $227,500 and the sales value of product 3 is $3,500 instead of $35,000. Assume also that the firm treats product 3 as a joint product and uses the net realizable value method for accounting for joint costs. There are no separable processing costs for product 3. What amount of joint costs would be allocated to the three products using the relative sales value method? (Round your intermediate percentage values to 2 decimal places (i.e. 24.35%) and final answers to nearest whole dollar amount.)
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