Roy, Inc., is a large food$-$processing company. It processes $154,000$ pounds of peanuts in the peanuts department at a cost of $$228,900$ to yield

$15,000$ pounds of product $A,61,000$ pounds of product $B,$ and $17,000$ pounds of product $C.$

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The company wants to make a gross margin of $10\%$ of revenues on product $C$ and needs to allow $20\%$ of revenues for marketing costs on

product C$.$ An overview of operations follows:

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Read the requirements.

Let's begin by determining the formula to compute the joint costs allocated for product $C$ by entering the appropriate amounts.

More info

Product $A$ is processed further in the salting department at a cost of $$13,000.$ It yields $15,000$

pounds of salted peanuts, which are sold for $$9$ per pound.

Product B $($raw peanuts$)$ is sold without further processing at $$6$ per pound.

Product $C$ is considered a byproduct and is processed further in the paste department at a cost of

$$12,100.$ It yields $17,000$ pounds of peanut butter, which are sold for $$10$ per pound.

Requirements

Compute unit costs per pound for products $A,B,$ and $C,$ treating $C$ as a byproduct. Use

the NRV method for allocating joint costs. Deduct the NRV of the byproduct produced

from the joint cost of products A and $B.$

Compute unit costs per pound for products $A,B,$ and $C,$ treating all three as joint

products and allocating joint costs by the NRV method.