Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Requirement 1 . Calculate how the joint costs of $ 6 6 , 0 0 0 would be allocated between chocolate powder and milk chocolate

Requirement 1. Calculate how the joint costs of $66,000 would be allocated between chocolate powder and milk chocolate under the different methods.
a. Sales value at splitoff method. Begin by entering the appropriate amounts to allocate the joint costs. (Round the weighting amounts to four decimal places.)
Requirements
Calculate how the joint costs of $66,000 would be allocated between chocolate powder
and milk chocolate under the following methods:
a. Sales value at splitoff
b. Physical measure (gallons)
c. NRV
d. Constant gross-margin percentage NRV
What are the gross-margin percentages of chocolate powder and milk chocolate under
each of the methods in requirement 1?
Could Cocoa Mass Edibles Factory have increased its operating income by a change in its
decision to fully process both of its intermediate products? Show your computations.
More info
Cocoa beans processed, 31,500 pounds
Costs of processing cocoa beans to splitoff point (including purchase of beans), $66,000
More info
Cocoa Mass Edibles Factory fully processes both of its intermediate products into chocolate powder or milk chocolate.
There is an active market for these intermediate products. In August 2020, Cocoa Mass Edibles Factory could have
sold the chocolate-powder liquor base for $42 a gallon and the milk-chocolate liquor base for $52 a gallon.
It purchases cocoa beans and processes them into two intermediate products:
chocolate-powder liquor base and milk-chocolate liquor base. These two
intermediate products become separately identifiable at a single splitoff point.
Every 2,100 pounds of cocoa beans yields 40 gallons of chocolate-powder liquor
base and 60 gallons of milk-chocolate liquor base.
The chocolate-powder liquor base is further processed into chocolate powder.
Every 40 gallons of chocolate-powder liquor base yield 660 pounds of chocolate
powder. The milk-chocolate liquor base is further processed into milk chocolate.
Every 60 gallons of milk-chocolate liquor base yield 1,080 pounds of milk
chocolate.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting A Smart Approach

Authors: Mary Carey, Cathy Knowles, Jane Towers-Clark

3rd Edition

0198745133, 978-0198745136

More Books

Students also viewed these Accounting questions

Question

please dont use chat gpt AI 2 3 0 . .

Answered: 1 week ago