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Chem Manufacturing Company processes direct materials up to the split-off point where two products (X and Y) are obtained and sold. The following information
Chem Manufacturing Company processes direct materials up to the split-off point where two products (X and Y) are obtained and sold. The following information was collected for the month of November Direct materials processed. 10,900 gallons (10,900 gallons yield 10,100 gallons of good product and 800 gallons of shrinkage) Production X 5,300 gallons Y 4,800 gallons Sales: x 5,050 at $400 per gallon Y 4,550 at $80 per gallon The cost of purchasing 10,900 gallons of direct materials and processing it up to the split-off point to yield a total of 10,100 gallons of good products was $1,200,000 OA. 52% OB. 76% OC. 240% OD. 71%
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