St. John Mining operates several facilities. At one, a typical batch of an ore, Pryex, run through
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St. John Mining operates several facilities. At one, a typical batch of an ore, Pryex, run through the processing plant yields three products: PX-10, PX-20, and PX-30. At the split-off point, the intermediate products cannot be sold without further processing. A typical batch of PX-10 sells for $110,000 after incurring additional processing costs of $20,000. PX-20 can be sold for $170,000 after additional processing costs of $44,000, and the PX-30 sells for $220,000 but requires additional processing costs of $76,000. The joint costs of processing the Pryex, including the cost of mining, are $240,000 per batch.
Required
Use the estimated net realizable value method to allocate the joint processing costs.
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