Organic Chicken grows and processes chickens. Each chicken is disassembled into five main parts. Information pertaining to production in July 2017 is as follows:

Joint cost of production in July 2017 was $100. A special shipment of 75 pounds of breasts and 15 pounds of wings has been destroyed in a fire. Organic Chicken's insurance policy provides reimbursement for the cost of the items destroyed. The insurance company permits

Organic Chicken to use a joint-cost-allocation method. The splitoff point is assumed to be at the end of the production process.

Read the requirements2.

Requirement 1a. Compute the cost of the special shipment destroyed using the sales value at splitoff method.

Complete the table below to assist you. (Round the weighting to three decimal places and the allocated costs per pound to four decimal places. Round all other amounts to the nearest cent.)

	Breast	Wings	Thighs	Bones	Feathers	Total
Pounds of product	200	50	100	140	10
Wholesale selling price
per pound	$0.55	$0.30	$0.35	$0.05	$0.10
Sales value at splitoff
Weighting: Sales value
at splitoff
Joint costs allocated
Allocated costs
per pound

(Round your answers to the nearest cent.)

The cost of the 75 pounds of breasts is

. The cost of the 15 pounds of wings is

.

Requirement 1b. Compute the cost of the special shipment destroyed using the physical-measure method (pounds of finished product).

Complete the table below to assist you. (Round the weighting to three decimal places, the allocated costs per pound to four decimal places, and the joint costs allocated to the nearest cent.)

	Breasts	Wings	Thighs	Bones	Feathers	Total
Pounds of product	200	50	100	140	10
Weighting: Physical measures
Joint costs allocated
Allocated costs per pound

(Round your answers to the nearest cent.)

The cost of the 75 pounds of breasts is

. The cost of the 15 pounds of wings is

.

Requirement 2. What joint-cost-allocation method would you recommend

Organic

Chicken use? Explain.The (1) method captures the benefits-received criterion of cost allocation and is the preferred method. The costs of processing a chicken are allocated to products in proportion to (2) Organic Chicken's decision to process chicken is heavily influenced by the (3) . The (4) provide relatively few benefits to Organic Chicken despite their high physical volume.

1: Data Table

Parts	Pounds of Product	Wholesale Selling Price per Pound When Production is Complete
Breast	200	$0.55
Wings	50	0.30
Thighs	100	0.35
Bones	140	0.05
Feathers	10	0.10

2: Requirements

1.	Compute the cost of the special shipment destroyed using the following:
	a.	Sales value at splitoff method
	b.	Physical-measure method (pounds of finished product)
2.	What joint-cost-allocation method would you recommend Organic Chicken use? Explain.