Inorganic Chemicals (IC) processes salt into various industrial products. In July 2012, IC incurred joint costs of $100,000 to purchase salt and convert it into two products: caustic soda and chlorine. There were no beginning or ending inventories of salt, caustic soda and chlorine in July. Information for July 2012 production and sales follows: B 1 A Joint costs (costs of salt and processing to 2 splitoff point) 3 C Joint Costs $100,000 4 Caustic Soda Chlorine 5 Beginning inventory (tons) 6 Production (tons) 7 Sales (tons) 0 0 1,200 800 1,200 800 8 Ending inventory (tons) 0 0 9 Selling price per ton for products sold $ 50 $75 Allocate the joint costs of $100,000 between caustic soda and PVC under (a) the sales value at splitoff method and (b) the physical- measure method Prepare Income Statement Exercise Inorganic Chemicals (IC) processes salt into various industrial products. In July 2012, IC incurred joint costs of $100,000 to purchase salt and convert it into two products: caustic soda and chlorine. Although there is an active outside market for chlorine, IC processes all 800 tons of chlorine it produces into 500 tons of PVC (polyvinyl chloride), which is then sold. There were no beginning or ending inventories of salt, caustic soda, chlorine, or PVC in July. Information for July 2012 production and sales follows: 1 A Joint costs (Costs of sat and processing to 2 splitoff point) Separable cost of processing 800 tons 3 chlorine into 500 tons PVC 4 5 6 Beginning invertory points) 9 Sales (tons) 7 Production (tons) 8 Transfer for further processing (tons) 10Ending inventory (tons) Selling price per ton in active outside 11market (for products not actually sold) 12 Selling price per ton for products sold -- Joint Costs D PVC $100,000 $20,000 Caustic Soda Chlorine PVC 0 0 1,200 800 500 800 1,200 500 0 0 $ 50 $75 $ 200 Allocate the joint costs of $100,000 between caustic soda and PVC under (a) Net Realizable Value (b) Constant Gross-Margin Percentage NRV Prepare Income Statement