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 C (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 C (round to the nearest dollar)?

Quizplus · Accepted Answer

To allocate the joint processing cost of $2,100 to Product C using the sales value at split-off method, first calculate the total sales value at split-off for all products: A = 800 lbs * $6.50 = $5,200 B = 1,100 lbs * $8.25 = $9,075 C = 1,500 lbs * $8.00 = $12,000 Total sales value at split-off = $5,200 + $9,075 + $12,000 = $26,275 The proportion of total sales value for Product C = $12,000 / $26,275 = 0.4568 or 45.68% The amount of joint processing cost allocated to Product C = 45.68% * $2,100 = $959 (rounded to the nearest dollar).

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