Bailey Products produces two joint products (A and B). Prior to the split-off point, the company incurs

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Bailey Products produces two joint products (A and B). Prior to the split-off point, the company incurs costs of $6,000. Product A weighs 30 pounds, and Product B weighs 120 pounds. Product A sells for $240 per pound, and Product B sells for $20 per pound. 


Required 

a. Based on relative sales values at the split-off point, allocate joint costs to Products A and B. 

b. Under what condition would the cost allocated using relative sales values be greater than the selling price of a joint product?

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Managerial Accounting

ISBN: 9781119577720

7th Edition

Authors: James Jiambalvo

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