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2. Suppose the company does process Crummies into the mulch. Use the net-realizable- value method to allocate the joint production cost between the mulch and
2. Suppose the company does process Crummies into the mulch. Use the net-realizable- value method to allocate the joint production cost between the mulch and the Yummies. (Do not round intermediate calculations.) Allocation of Joint Cost Yummies Mulch Required information [The following information applies to the questions displayed below.] Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows: Joint Cost Cereal Quantity at Split-Off Point 12,000 kilograms 8,000 kilograms Sales Price per Kilogram $6.00 7.50 $90,000 Yummies Crummies Breakfasttime Cereal Company has an opportunity to process its Crummies further into a mulch for ornamental shrubs. The additional processing operation costs $1.50 per kilogram, and the mulch will sell for $10.50 per kilogram. Required: 1-a. Compute the net incremental revenue per kilogram if management decide to process Crummies into the mulch. (Round your answer to 2 decimal places.) Net incremental revenue per kilogram 1-b. Should Breakfasttime's management decide to process Crummies into the mulch? No O Yes
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