Baker Company Baker Company produces three products: A,B,and C from the same process.Joint costs for this production run are $2,100.

Pounds Sales price per lb. at split-off Disposal cost per lb. at split-off Further processing per pound Final sales price per pound

A 800 $6.50 $3.00 $2.00 $ 7.50

B 1,100 8.25 4.20 3.00 10.00

C 1,500 8.00 4.00 3.50 10.50

If the products are processed further,Baker Company will incur the following disposal costs upon sale: A,$3.00;B,$2.00;and C,$1.00. Refer to Baker Company.Using sales value at split-off,what amount of joint processing cost is allocated to Product B (round to the nearest dollar)?

Question

Baker Company Baker Company produces three products: A,B,and C from the same process.Joint costs for this production run are $2,100.

	Pounds	Sales price per lb. at split-off	Disposal cost per lb. at split-off	Further processing per pound	Final sales price per pound
A	800	$6.50	$3.00	$2.00	$ 7.50
B	1,100	8.25	4.20	3.00	10.00
C	1,500	8.00	4.00	3.50	10.50

If the products are processed further,Baker Company will incur the following disposal costs upon sale: A,$3.00;B,$2.00;and C,$1.00. Refer to Baker Company.Using sales value at split-off,what amount of joint processing cost is allocated to Product B (round to the nearest dollar)?

Quizplus · Accepted Answer

To allocate the joint processing costs using the sales value at split-off method, first calculate the total sales value at split-off for each product, then find the proportion of each product's sales value relative to the total sales value, and finally apply these proportions to the total joint costs.- Product A: 800 lbs * $6.50/lb = $5,200- Product B: 1,100 lbs * $8.25/lb = $9,075- Product C: 1,500 lbs * $8.00/lb = $12,000Total sales value at split-off = $5,200 + $9,075 + $12,000 = $26,275Product B's proportion of total sales value = $9,075 / $26,275 = 0.3454 (or 34.54%)Allocated joint processing cost to Product B = 0.3454 * $2,100 = $725 (rounded to the nearest dollar)

Baker Company Baker Company Produces Three Products: A,B,and C from the Same