The Kenton Company processes unprocessed milk to produce two products,Butter Cream and Condensed Milk.The following information was collected for the month of June:

The cost of purchasing the of unprocessed milk and processing it up to the split-off point to yield a total of 27,500 gallons of saleable product was $53,000.
The company uses constant gross-margin percentage NRV method to allocate the joint costs of production.What is the allocated joint costs of Butter Cream? (Round intermediary percentages to the nearest hundredth. )
A)$33,580
B)$13,000
C)$35,600
D)$19,428

Question

The Kenton Company processes unprocessed milk to produce two products,Butter Cream and Condensed Milk.The following information was collected for the month of June:

The cost of purchasing the of unprocessed milk and processing it up to the split-off point to yield a total of 27,500 gallons of saleable product was $53,000.
The company uses constant gross-margin percentage NRV method to allocate the joint costs of production.What is the allocated joint costs of Butter Cream? (Round intermediary percentages to the nearest hundredth. )
A)$33,580 
B)$13,000 
C)$35,600 
D)$19,428

Quizplus · Accepted Answer

Gross margin percentage calculation:
($176,250 - $53,000 - $35,600 - $13,000)/ $176,250 = 42.35%
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The Kenton Company Processes Unprocessed Milk to Produce Two Products,Butter