Allocation of joint costs LO₅ Robin Manufacturing Company buys crypton for $0.80 a gallon. At the end of processing in Dept. I, crypton splits off into products A, B, and C. Product A is sold at the split-off point with no further processing. Products B and C require further processing before they can be sold. Product B is processed in Dept. 2, and Product C is processed in Dept. 3. Following is a summary of costs and other related data for the year ended December 3 1

No inventories were on hand at the beginning of the year, and no crypton was on hand at the end of the year. All gallons on hand at the end of the year were complete as to processing. Robin uses the relative sales value method of allocating joint costs.

REQUIRED:

1. Calculate the allocation of joint costs.

2. Calculate the cost of Product B sold.

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Cost of crypton Direct labor. Factory overhead Total Dept. I Dept. 2 Dept. 3 $ 76,000 14,000 $45,000 $ 65,000 10,000 21,000 49,000 $100,000 $66,000 $114,000 Product A Product B Product C Gallons sold.. 20,000 30,000 45,000 Gallons on hand at December 31... 10,000 15,000 Sales in dollars $30,000 $96,000 $141,750