STOP-CHECK PROBLEM Hambaga, Inc. produces whole pears, diced pears, and animal feed in a joint process with joint costs of $1,000,000. After picking, pears are divided into grades. Pears of the highest grade are sold to retail outlets for $1 per pound without further processing. Medium-grade pears, which can sell for $0.60 per pound without further processing, are diced and canned at a cost of $0.75 per pound. Each pound of pears yields 2 cans of diced pears that can be sold for $0.80 each. The lowest grade of pears, which could sell for $0.20 per pound without further processing, is processed into animal feed at a cost of $0.05 per pound, and the final product is sold in 10-pound bags at $2.20 each. The animal feed is considered a byproduct. This period, 800,000 pounds of top-grade pears, 500,000 pounds of mid-grade pears, and 400,000 pounds of low-grade pears were picked. 1. Assume that the animal feed is accounted for at the time of sale. Allocate the joint costs using the sales value at splitoff as a cost allocation base. a. First, calculate the amount of the cost allocation base to be used to allocate the joint costs for each joint product. Stop-Check! b. Next, allocate the joint costs to the joint products. Stop-Check! c. Finally, calculate the profitability of each product. Stop-Check! 2. Assume that the animal feed is accounted for at the time of production. Allocate the joint costs using the net realizable value as a cost allocation base. a. First, subtract the net realizable value of the byproduct from joint costs. Stop-Check! b. Next, calculate the amount of the cost allocation base to be used to allocate the joint costs for each joint product. Stop-Check! c. Next, allocate the joint costs to the joint products. Stop-Check! d. Finally, calculate the profitability of each product. Stop-Check!