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The Firm incurs $3,000,000 in joint costs during the production of 4 products X, B, C, and D. Additional information includes the following: Units of
The Firm incurs $3,000,000 in joint costs during the production of 4 products X, B, C, and D. Additional information includes the following: | |||||||
Units of Production (lbs.) | Weighting | Market Value at Split-Off | Separable Costs | Gross Revenues | |||
X: | 10,000 | 1.00 | 2,300,000 | 200,000 | 3,000,000 | ||
B: | 20,000 | 1.50 | 2,800,000 | 400,000 | 4,200,000 | ||
C: | 30,000 | 2.50 | 1,000,000 | 700,000 | 2,000,000 | ||
D: | 6,000 | 3.00 | 40,000 | 300,000 | 720,000 |
Calculate the joint cost allocation ONLY FOR PRODUCT X using the following methods:
Net Realizable Value ANSWER: ___________________
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