Allocating joint product cost Terry Chemical Company makes three products, B217, K360, and X639, which are joint products from the same materials. In a standard batch of 300,000 pounds of raw materials, the company generates 70,000 pounds of B217, 150,000 pounds of K360, and 80,000 pounds of X639. A standard batch costs $1,800,000 to produce. The sales prices per pound are $4.00, $9.60, and $16.00 for B217, K360, and X639, respectively.

Required

a. Allocate the joint product cost among the three final products using weight as the allocation base.

b. Allocate the joint product cost among the three final products using market value as the allocation base.

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