Answered step by step
Verified Expert Solution
Question
1 Approved Answer
need B finished By-product and cost allocation Dover Studios shot hundreds of hours of footage that cost $16,000,000. From this footage, the company produced two
need B finished By-product and cost allocation Dover Studios shot hundreds of hours of footage that cost $16,000,000. From this footage, the company produced two movies: Star World and Star World: The Sequel. The sequel used better sound effects than the original, was significantly more expensive to produce, and was much better received at the box office. Dover Studios also generated revenue from admissions paid by numerous movie fans who wanted to tour the movie production set. The company accounted for this revenue as a by-product and used it to reduce joint cost before making allocations to the two feature-length movies. The following information pertains to the two movies: Products Total Receipts Separate Costs Star World $8,000,000 $5,440,000 Star World: The Sequel 46,400,000 32,960,000 Studio tours 640,000 384,000 a. Ifjoint cost is allocated based on net realizable value, how much of the joint cost is allocated to each movie? Star World $ Star World: The Sequel 2,560,000 13,440,000 Products Star World Star World: The Sequel Studio tours $8,000,000 46,400,000 640,000 $5,440,000 32,960,000 384,000 a. If joint cost is allocated based on net realizable value, how much of the joint cost is allocated to each movie? Star World $ Star World: The Sequel Total $ 2,560,000 13,440,000 16,000,000 0 b. Based on your allocations in (a), how much profit was generated by each movie? Star World Star World: The Sequel Total 0 0 Next >> Previous Save Answers
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started