Question
need answer quickly Johnston Adhesives Company makes three widely used industrial adhesives : A101 , A204 , and B216 . Sales and production informationfor each
need answer quickly
Johnston Adhesives Company makes three widely used industrial adhesives : A101 , A204 , and B216 . Sales and production informationfor each of the three adhesives are shown in the following table . Most of Johnston's customers ask for a special blend of the three products , which improves heat - resistance . The additional separable processing requires additional time and materials , and the price is increased accordingly , as shown in the table . Assume that Johnston produces only for specific customer orders , so there is no beginning or ending inventory . Assume also that all of Johnston's customers requested the heat -resistant version of the products so that all production required additional separable processing . Total joint cost for the three products is \$3,209,000 .
Gallons sold Final sales price per gallon Price at split-off Separable processing cost A101 200,000 $ 11 8 $ 459,000 A204 186,000 $ 8 4 $ 110,000 B216 125,000 $ 11 7 $623,000 Required: 1. Calculate the unit product cost and total gross margin for each of the three product lines using the following methods: (a) physica measure method, (b) sales value at split-off method, (c) the net realizable value method, and (d) the constant gross margin percenta method. (Round intermediate calculations and cost per unit answers to 4 decimal places. Round your final answers to whole de amounts. Negative amounts should be indicated with a minus sign.) A101 A204 B216 a. Physical Measure Method Cost per unit Total gross margin b. Sales Value at Split-Off Method Cost per unit Total gross margin c. Net Realizable Value Method Cost per unit Total gross margin d. Constant Gross Margin Method Cost per unit Total gross margin d. Constant Gross Margin Method Cost per unit Total gross margin 2. Which of the four methods do you think would be preferred in this case? O Physical measure method O Sales value at split-off method O Net realizable value method O Constant gross margin methodStep by Step Solution
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