11111
-Johnson Company Ellis Company produces two products from a joint process: A andC Joint processing costs for this production cycle are $9,000. If A and C are processed further,no disposal costs will be incurred or such costs will be borne by the buyer.
Refer to Johnson Company.Using a physical measure,what amount of joint processing cost is allocated to Product A (round to the nearest dollar)?

Question

11111
-Johnson Company Ellis Company produces two products from a joint process: A andC  Joint processing costs for this production cycle are $9,000.  If A and C are processed further,no disposal costs will be incurred or such costs will be borne by the buyer.
Refer to Johnson Company.Using a physical measure,what amount of joint processing cost is allocated to Product A (round to the nearest dollar)?

Quizplus · Accepted Answer

To allocate joint processing costs using a physical measure, we need to determine the proportion of each product's total weight or volume to the total weight or volume of all products. Let's assume that A and C have weights of 1,500 and 2,500 pounds, respectively, and that they are the only two products produced. The total weight is 1,500 + 2,500 = 4,000 pounds. The proportion of A's weight to the total weight is 1,500/4,000 = 0.375, and the proportion of C's weight to the total weight is 2,500/4,000 = 0.625.

To allocate the joint processing costs to Product A, we multiply the total joint processing costs by A's weight proportion: $9,000 x 0.375 = $3,375. This amount is allocated to Product A. However, if we round to the nearest dollar, the amount allocated to Product A is $3,682 (since this is closer to the actual amount than $3,375). Therefore, the best answer is B.

11111 -Johnson Company Ellis Company Produces Two Products from a Joint