Question
Company processes apples into jam, juice, and canned tomatos. During the summer of 2018, the joint costs of processing the tomatoes were $10,000. There was
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Company processes apples into jam, juice, and canned tomatos. During the summer of 2018, the joint costs of processing the tomatoes were $10,000. There was no beginning or ending inventories for the summer. Production and sales value information is as follows:
Product
Cases
Sales Price at Splitoff Point
Separable Costs
Final Selling Price
Jam
100
$6 per case
$3.00 per case
$28 per case
Juice
150
8 per case
5.00 per case
25 per case
Canned
200
5 per case
2.00 per case
10 per case
Product
Final Sales Value
Separable Costs
Net Realizable Value
Percentage
Joint Costs
Allocated
Jam
Juice
Canned Tomato
Totals
Required:
Determine the percentage allocated to each product and amount of Joint Costs allocated to each product if the estimated NRV (net realizable value) method is used.
A. Jam 30% and $3,000; Juice 50% and $5,000; Canned tomato 20% and $2,000
B. Jam 35,2% and $3,520; Juice 42,25% and $4,225; Canned tomato 22,53% and $2,253
C. Jam 35% and $3,000; Juice 50% and $5,000; Canned tomato 15% and $2,000
D. Jam 25,5% and $2,550; Juice 54,5% and $5,450; Canned tomato 20% and $2,000
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