Designer Company processes copper ore into two products,C and U.The ore costs $5 per pound and conversion costs are $15 per pound.Designer Company plans to produce 40,000 pounds of Product C and 20,000 pounds of Product U from 60,000 pounds of ore.Product C sells for $30 per pound and Product U sells for $40 per pound.Assume the company uses the physical-units method of allocating joint costs.What amount of joint costs is allocated to Product U?
A) $0
B) $100,000
C) $300,000
D) $400,000

Question

Quizplus · Accepted Answer

The Answer of Designer Company processes copper ore into two products,C and U.The ore costs $5 per pound and conversion costs are $15 per pound.Designer Company plans to produce 40,000 pounds of Product C and 20,000 pounds of Product U from 60,000 pounds of ore.Product C sells for $30 per pound and Product U sells for $40 per pound.Assume the company uses the physical-units method of allocating joint costs.What amount of joint costs is allocated to Product U?
A) $0
B) $100,000
C) $300,000
D) $400,000

Designer Company Processes Copper Ore into Two Products,C and U