Joint products and byproducts (continuation of 15-16). Chicken Litde is computing the ending inventory values for itsJuly 31, 2007, balance sheet. Ending inventory amounts on July 31 are 15 kilograms of breasts, 6 kilograms ofwings, 4 kilograms ofthighs, 9 kilograms of bones, and 3 kilograms offeathers.

Chicken Little’s management wants to use die sales value at splitoff method. However, they want you to explore the effect on ending inventory values of classifying one or more products as a byproduct rather than a joint or main product.

Required 1. Assume Chicken Litde classifies all five products as joint products. What are the ending inventory values of each product on July 31, 2007?

2. Assume Chicken Little uses a byproduct method that recognizes byproducts in the finan¬

cial statements at the time production is completed. The total revenues to be received from the sale of byproducts produced that period is offset against the joint cost of production of the joint products. What are the ending inventory values for each joint product and byproduct on July 31, 2007, assuming breasts and thighs are the joint products and wings, bones, and feathers are byproducts.

3. Repeat requirement 2 using the byproduct method that recognizes byproducts in financial statements (as a revenue item) at the time of their sale.

4. Comment on differences in the results in requirements 1,2, and 3.