Question
Company manufactures two products, A and B from a joint process. It costs the company 800,000 in a joint process to product 1,000 units of
Company manufactures two products, A and B from a joint process. It costs the company 800,000 in a joint process to product 1,000 units of A and 5,000 units of B. Both of the products can be sold at the split-off point or they can be processed further to completion. To process further the company incurs separable costs of $81 per units for A, and $35 for units of B. A and B can be sold for $100, and $200 respectively at completion.
What is the amount of separable costs assigned to products X and Y assuming joint costs are allocated using net realizable value method?
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