Accounting for by-product Potato skins are generated as a by-product in making potato chips and frozen hash browns at Zeena Foods. The skins are sold to restaurants for use in appetizers. Processing and disposal costs associated with by-product sales are $0.06 per pound of potato skins. During May, Zeena Foods produced and sold 216,000 pounds of potato skins for $32,400. In addition, the joint cost for producing potato chips and hash browns was $131,200; separate costs of production were $76,800. In May, 90 percent of all joint production was sold for $510,400. Non-factory operating expenses for May were $76,560. $ $ $ $ a. Prepare an income statement for Zeena Foods assuming that by-product sales are shown as Other Revenue and the processing and disposal costs for the by-product are shown as additional cost of goods sold of the joint products. Note: Do not use a negative sign with your answers. Zeena Foods Income Statement For Month Ended May 31 Sales revenue (joint products) 510,400 Cost of goods sold: Joint cost 118,080 Separate costs 69,120 By-products 12,960 Gross profit 310,240 Non-factory expenses 76,560 Income from operations 233,680 Other revenues (by-product sales) 32,400 Income before taxes 266,080 b. Prepare an income statement for Zeena Foods assuming that the net realizable value of the by-product is shown as Other Income. Note: Do not use a negative sign with your answers. Zeena Foods Income Statement For Month Ended May 31 Sales revenue (joint products) 510,400 Cost of goods sold 187,200 Gross profit 323,200 Non-factory expenses 76,560 Income from operations 246,640 Other income (by-product sales) 19,440 Income before taxes $ 266,080 c. Prepare an income statement for Zeena Foods assuming that the net realizable value of the by-product is subtracted from the joint cost of the main products. Note: Do not use a negative sign with your answers. Zeena Foods Income Statement For Month Ended May 31 Sales revenue 510,400 Cost of goods sold Gross profit $ Non-factory expenses 76,560 Income before taxes $ $ $ $ 0 X OX $ OX