(Physical measure joint cost allocation) Midwest Soybeans operates a process¬ ing plant in which soybeans are “crushed” to create soybean oil and soy¬ bean meal. The company purchases soybeans by the bushel (60 pounds). From each bushel, the normal yield is 11 pounds of soybean oil, 44 pounds of soybean meal, and 5 pounds of waste. For March, Midwest purchased and processed 5,000,000 bushels of soybeans. The yield in March on the soybeans was equal to the normal yield. The following costs were incurred for the month:

At the end of March there were no in-process or raw material in inventory. Also, there was no beginning finished goods inventory. For the month, 80 percent of the soybean meal and 60 percent of the soybean oil were sold.

a. Allocate the joint cost to the joint products on the basis of pounds of product produced.

b. Calculate the cost of goods sold for March.

c. Calculate the cost of finished goods inventory at the end of March. LO1.

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Soybeans $47,500,000 Conversion costs 2,300,000