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Quatro Corporation manufactures two chemicals (Flextra and Hydro) in a joint process. Data from a recent month follow. Direct materials used: $410,000 Direct labor: $200,000
Quatro Corporation manufactures two chemicals (Flextra and Hydro) in a joint process. Data from a recent month follow. Direct materials used: $410,000 Direct labor: $200,000 Manufacturing overhead: $740,000 Manufacturing output: Flextra: 37,500 gallons Hydro: 115,000 gallons Flextra sells for $20 per gallon and Hydro sells for $25 per gallon. Required: A. Compute the total joint costs to be allocated to Flextra and Hydro. B. Compute the joint costs that would be allocated to Flextra by using the physical-units method. C. Compute the joint costs that would be allocated to Hydro by using the relative-sales-value method. D. Assume that Hydro can be converted into a more refined product, Hydro-R, in a totally separable process at an additional cost of $9 per gallon. If the refined product can be sold in the marketplace for $31 per gallon, compute the net realizable value of Hydro-R. (For all requirements, do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) A. Total joint costs B. Physical-units method Relative-sales-value method D. Net realizable value
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