BUS 511 CASE 3 CPA BEC S3

Bennett Corporation Year 4 Production

Kerosene and Fuel OilAllocation by Unit Volume

Kerosene3,500 gallons/mt. for 3 months and 4,260 gallons/mt. for 9 months

Fuel oil8,490 gallons/mt. for 4 months and 10,000 gallons/mt. for 8 months

Joint costs: $45,000

Liquid Asphalt and GasolineRelative NRV (Sales Value Known at Split-Off)

Liquid asphalt2,850 gallons sold at $13/unit

Gasoline1,900 gallons sold at $18/unit

Joint costs: $6,500

Coal Tar and ParaffinRelative NRV (No Sales Value Known at Split-Off)

Coal tar4,000 pounds sold at $40/unit; further processing costs: $52,000

Paraffin2,800 pounds sold at $60/unit; further processing costs: $36,000

Joint costs: $80,000

Bennett Corporation is a petroleum manufacturer which produces several sets of joint products; these products include kerosene and fuel oil, liquid asphalt and gasoline, and coal tar and paraffin. A senior cost accountant for Bennett has been asked by her boss to take all three sets of products and allocate the associated joint costs based on three different allocation methodologies.

Using the information included within the exhibit, complete the table below for Year 4.

For each product in column A, calculate the allocated joint costs and enter your associated response rounded to whole numbers in column B. If a response is zero, enter a zero (0).

Product	Allocated Joint Costs
Kerosene
Fuel oil
Liquid asphalt
Gasoline
Coal tar
Paraffin