Impacto Corporation produces four products in a joint process for $650,000. The following information is available on total sales and production in units: $\begin{array}{lll}\text { Products }& \text { Sales }& \text { Production }\
\mathrm{I} & 1,000 & 4,000 \
\text { L } & 2,000 & 5,000 \
\text { E } & 3,000 & 7,000 \
\text { S } & 4,000 & 8,000
\end{array}$ What amount of joint costs will be allocated to I based on the physical units method?
A)$100,000
B)$650,000
C)$108,355
D)$300,000

Question

Quizplus · Accepted Answer

The physical units method allocates joint costs based on the number of units produced. In this case, Product I has 4,000 units out of a total of 24,000 units produced. Therefore, Product I will be allocated 4,000/24,000 * $650,000 = $108,333.33 of joint costs.

Impacto Corporation Produces Four Products in a Joint Process for $650,000