(Journal entries) Desirable Inc. uses a joint process to make two main prod¬ ucts: Forever perfume and Fantasy lotion. Production is organized in two se¬ quential departments: Combining and Heating. The products do not become separate until they have been through the heating process. After heating, the perfume is removed from the vats and bottled without further processing. The residue remaining in the vats is then blended with aloe and lanolin to become the lotion.

The following costs were incurred in the Combining Department during October 2006: direct material, $28,000; direct labor, $7,560; and applied manufacturing overhead, $4,250. Prior to separation of the joint products, costs in the Heating Department for the month were direct material, $6,100; direct labor, $2,150; and applied manufacturing overhead, $3,240. After split- off, the Heating Department incurred separate costs for each product line as follows: bottle for Forever perfume, $2,120; and direct material, direct labor, and applied manufacturing overhead of $1,960, $3,120, and $4,130, respec¬ tively, for Fantasy lotion.

Neither department had beginning Work in Process Inventory balances, and all work that started in October was completed in that month. Joint costs are allocated to perfume and lotion using approximated net realizable values at split-off. For October, the approximated net realizable values at split-off were $158,910 for perfume and $52,970 for lotion.

a. Prepare journal entries for the Combining and Heating Departments for October 2006.

b. Determine the joint cost allocated to and the total cost of Forever per¬ fume and Fantasy lotion.

c. Diagram the flow of costs for these two company products.

 LO1.