Net Realizable Value Method, Decision to Sell at Split-off or Process FurtherPacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $50,000, and 15,000 units of overs and 34,000 units ofunders were produced. Separable processing costs beyond the split-off point were as follows: overs, $20,000; unders, $16,760. Overs sell for $2.00 per unit; unders sellfor $3.14 per unit.Required:1. Allocate the $50,000 joint costs using the estimated net realizable value method.Allocated Joint CostOversUnders2. Suppose that overs could be sold at the split-off point for $1.80 per unit. Should Pacheco sell overs at split-off or process them further?Overs should notbe processed further as there will be $moreprofit if sold at split-off.

Joint cost:The costs or expenses incurred to produce more than one product or process is known as…

et Realizable Value Method, Decision to Sell at Split-off or Process Further acheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $50,000, and 15,000 units of overs and 34,000 units of nders were produced. Separable processing costs beyond the split-off point were as follows: overs, $20,000; unders, $16,760. Overs sell for $2.00 per unit; unders sell or $3.14 per unit. equired: Allocate the $50,000 joint costs using the estimated net realizable value method. Allocated Joint Cost

et Realizable Value Method, Decision to Sell at Split-off or Process Further acheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $50,000, and 15,000 units of overs and 34,000 units of nders were produced. Separable processing costs beyond the split-off point were as follows: overs, $20,000; unders, $16,760. Overs sell for $2.00 per unit; unders sell or $3.14 per unit. equired: Allocate the $50,000 joint costs using the estimated net realizable value method. Allocated Joint Cost

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 27E: Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this...

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Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were 50,000, and 14,000 units of overs and 36,000 units of unders were produced. Separable processing costs beyond the split-off point were as follows: overs, 18,000; unders, 23,040. Overs sell for 2.00 per unit; unders sell for 3.14 per unit. Required: 1. Allocate the 50,000 joint costs using the estimated net realizable value method. 2. Suppose that overs could be sold at the split-off point for 1.80 per unit. Should Pacheco sell overs at split-off or process them further? Show supporting computations.
Venezuela Oil Inc. transports crude oil to its refinery where it is processed into main products gasoline, kerosene, and diesel fuel, and by-product base oil. The base oil is sold at the split-off point for $1,000,000 of annual revenue, and the joint processing costs to get the crude oil to split-off are $10,000,000. Additional information includes: Required: Determine the allocation of joint costs using the net realizable value method, rounding the sales value percentages to the nearest tenth of a percent. (Hint: Reduce the amount of the joint costs to be allocated by the amount of the by-product revenue.)
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: Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. (Round the percentages to four significant digits. Round all cost allocations to the nearest dollar.) 2. What if it cost 2 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products?
LeMoyne Manufacturing Inc.’s joint cost of producing 2,000 units of Product X, 1,000 units of Product Y, and 1,000 units of Product Z is $50,000. The unit sales values of the three products at the split-off point are Product X–$30, Product Y–$100, and Product Z–$90. Ending inventories include 200 units of Product X, 300 units of Product Y, and 100 units of Product Z. Compute the amount of joint cost that would be included in the ending inventory valuation of the three products on the basis of their sales values at split-off. Assume that Product Z can be sold for $120 a unit if it is processed after split-off at a cost of $10 a unit. Compute the amount of joint cost that would be included in the ending inventory valuation of the three products on the basis of their net realizable values.
Net Realizable Value Method, Decision to Sell at Split-off or Process Further Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $60,000, and 14,000 units of overs and 36,000 units of unders were produced. Separable processing costs beyond the split-off point were as follows: overs, $18,000; unders, $23,040. Overs sell for $2.00 per unit; unders sell for $3.14 per unit. Required: 1. Allocate the $60,000 joint costs using the estimated net realizable value method. Allocated Joint Cost Overs Unders 2. Suppose that overs could be sold at the split-off point for $1.80 per unit. Should Pacheco sell overs at split-off or process them further? Overs be processed further as there will be $ profit if sold at split-off.
Net Realizable Value Method, Decision to Sell at Split - off or Process Further Pacheco, Inc., produces two products, overs and unders, in a single process. The joint costs of this process were $60,000, and 15,000 units of overs and 34,000 units of unders were produced. Separable processing costs beyond the split - off point were as follows: overs, $20, 000; unders, $ 16,760. Overs sell for $2.00 per unit; unders sell for $ 3.14 per unit. Required: 1. Allocate the $60,000 joint costs using the estimated net realizable value method. Allocated Joint Cost Overs $ Unders $2. Suppose that overs could be sold at the split - off point for $1.80 per unit. Should Pacheco sell overs at split - off or process them further? Overs should not be processed further as there will be $ more profit if sold at split - off.
Net Realizable Value Method, Decision to Sell at Split-off or Process Further Arvin, Inc., produces two products, ins and outs, in a single process. The joint costs of this process were $60,000, and 13,000 units of ins and 37,000 units of outs were produced. Separable processing costs beyond the split-off point were as follows: ins, $94,000; outs, $465,000. Ins sell for $8.00 per unit; outs sell for $15.00 per unit. Required: 1. Allocate the $60,000 joint costs using the estimated net realizable value method. Ins Outs 2. Suppose that ins could be sold at the split-off point for $7.00 per unit. Should Arvin sell ins at split-off or process them further? Ins Allocated Joint Cost split-off. be processed further as there will be $ less more profit if sold at
Net Realizable Value Method, Decision to Sell at Split-off or Process Further Arvin, Inc., produces two products, ins and outs, in a single process. The joint costs of this process were $50,000, and 15,000 units of ins and 36,000 units of outs were produced. Separable processing costs beyond the split-off point were as follows: ins, $110,000; outs, $450,000. Ins sell for $8.00 per unit; outs sell for $15.00 per unit. Required: 1. Allocate the $50,000 joint costs using the estimated net realizable value method. Ins Outs Allocated Joint Cost 2. Suppose that ins could be sold at the split-off point for $7.00 per unit. Should Arvin sell ins at split-off or process them further? profit if sold at split-off. Ins be processed further as there will be $
Beta Company manufactures Products Tama and Mali from a joint process. The sales value at split-off point was P36,000 for 6,000 units of Product Tama and P24,000 for 2,000 units of Product Mali. Assuming that the portion of the total joint cost properly allocated to product Tama using the sales value at split-off point method was P30,000, what is the total joint cost? a. P40,000 b. P50,000 c. P60,000 d. P90,000
Corey Corporation manufactures joint products W and X. During a recent period, joint costs amounted to $450,000 in the production of 20,000 gallons of W and 50,000 gallons of X. Both products will be processed beyond the split-off point, giving rise to the following data: Separable processing costs Sales price (per gallon) if processed beyond split-off The joint cost allocated to W under the net-realizable-value method would be: (Do not round intermediate calculations.) Multiple Choice $156,000. $142,105, $110,000 $128.571. $40,000 $ 15 $ $160,000 13
ABC Company produces joint products X and Y, each of which incurs separable production costs after the split-off point. Information concerning a batch produced at a joint cost of $160,000 before split-off follows: Product X Y Total Separable costs $ 14,000 25,000 $ 39,000 Sales value $ 68,000 61,000 $ 129,000 What is the joint cost assigned to product line X if costs are assigned using relative net realizable value? a. $160,000 b. $64,000 C. $90,000 d. $96,000
Net Realizable Value Method, Decision to Sell at Split-off or Process Further Arvin, Inc., produces two products, ins and outs, in a single process. The joint costs of this process were $60,000, and 14,000 units of ins and 36,000 units of outs were produced. Separable processing costs beyond the split-off point were as follows: ins, $102,000; outs, $450,000. Ins sell for $8.00 per unit; outs sell for $15.00 per unit. Required: 1. Allocate the $60,000 joint costs using the estimated net realizable value method. Allocated Joint Cost Ins $fill in the blank 1 Outs $fill in the blank 2 2. Suppose that ins could be sold at the split-off point for $7.00 per unit. Should Arvin sell ins at split-off or process them further?Ins be processed further as there will be $fill in the blank 4 profit if sold at split-off.