Northern-Coast Oceanic Water (NOW) desalinates and bottles sea water. The desalinated water is in high demand from a large group of environmentally conscious people on the west coast of Canada. During March, NOW processes 1,700 litres of sea water and obtains 1,700 litres of drinking water and 60 kilograms of sea salt (the rest of the sea water evaporates in the desalinization process). Processing the 1.700 litres of water costs NOW $1,800. NOW sells 1,360 litres of the desalinated water in 2-litre containers for $8 per container. In addition, NOW sells 50 kilograms of sea salt for $1.60 per kilogram. Due to the relatively small proportion of sea salt, NOW has decided to treat it as a byproduct. Required Requirements 1 and 2. Assuming NOW accounts for the byproduct using the production method, what is the inventoriable cost for each product and NOW's gross margin? Calculate the gross margin and gross margin percentage for Northern-Coast Oceanic Inc. under the production method, and then for the sales method. (Only complete the necessary boxes, do not enter "0". Round interim calculations to the nearest cent. Round final answers to the nearest whole dollar. Round the gross margin percentage to two decimal places.) Production Method Sales Method Revenues Main product Byproduct Total revenues Cost of goods sold Gross margin Gross margin percentage % Northern-Coast Oceanic Water (NOW) desalinates and bottles sea water. The desalinated water is in high demand from a large group of environmentally conscious people on the west coast of Canada. During March, NOW processes 1,700 litres of sea water and obtains 1,700 litres of drinking water and 60 kilograms of sea salt (the rest of the sea water evaporates in the desalinization process). Processing the 1,700 litres of water costs NOW $1,800. NOW sells 1,360 litres of the desalinated water in 2-litre containers for 58 per container. In addition, NOW sells 50 kilograms of sea salt for $1.60 per kilogram. Due to the relatively small proportion of sea salt, NOW has decided to treat it as a byproduct. Required Requirements 1 and 2. Assuming NOW accounts for the byproduct using the production method, what is the inventoriable cost for each product and NOW's gross margin? Calculate the gross margin and gross margin percentage for Northern-Coast Oceanic Inc. under the production method, and then for the sales method. (Only complete the necessary boxes, do not enter "0". Round interim calculations to the nearest cent. Round final answers to the nearest whole dollar. Round the gross margin percentage to two decimal places.) Production Method Sales Method Revenues Main product Required Byproduct Total revenues Cost of goods sold Gross margin Gross margin percentage 1. Assuming NOW accounts for the byproduct using the production method, what is the inventoriable cost for each product and NOW's gross margin? 2. Assuming NOW accounts for the byproduct using the sales method, what is the inventoriable cost for each product and NOW's gross margin? 3. Discuss the difference between the two methods of accounting for byproducts. % % Print Done