Menkes Production Company manufactures two products from a joint process. The joint process costs $20,000. Both products must be processed past the split-off point to be marketable. White sugar produces 500 units or 20,000 lbs., incurs separable costs of $5 per unit, and has a market price of $25. Brown sugar produces 2,000 units or 50,000 lbs., incurs separable costs of $10 per unit, and has a market price of $20. Using the physical quantities method to allocate joint costs, how much joint costs will be allocated to each product? (round to the nearest whole dollar)

Question

Quizplus · Accepted Answer

The Answer of Menkes Production Company manufactures two products from a joint process. The joint process costs $20,000. Both products must be processed past the split-off point to be marketable. White sugar produces 500 units or 20,000 lbs., incurs separable costs of $5 per unit, and has a market price of $25. Brown sugar produces 2,000 units or 50,000 lbs., incurs separable costs of $10 per unit, and has a market price of $20. Using the physical quantities method to allocate joint costs, how much joint costs will be allocated to each product? (round to the nearest whole dollar)

Menkes Production Company Manufactures Two Products from a Joint Process