Restaurant Products produces two products, X and Y, in a single process. In 2011, the joint costs of this process were $25,000. In addition, 4,000 units of X and 6,000 units of Y were produced. Separable processing costs beyond the split-off point were X - $10,000; Y - $20,000. X sells for $10.00 per unit; Y sells for $7.50 per unit.
What amount of joint costs will be allocated to Product X using the physical units method?
A)$-0-
B)$10,000
C)$25,000
D)$15,000

Question

Quizplus · Accepted Answer

The physical units method allocates joint costs based on the proportion of total units produced. Product X accounts for 40% of the total units (4,000 out of 10,000), so 40% of $25,000 is $10,000.

Restaurant Products Produces Two Products, X and Y, in a Single