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The following questions relate to Kyle Company, which manufactures products KA, KB, and KC from a joint process. Joint product costs were $192,000. Additional information
The following questions relate to Kyle Company, which manufactures products KA, KB, and KC from a joint process. Joint product costs were $192,000. Additional information follows: If Processed Further Sales Value at Split- Product Units Produced Off Sales Values Additional Costs KA 87,000 $ 270,000 $360,000 $57,000 KB 63,000 240,000 300,000 45,000 KC 27,000 180,000 270,000 33,000 After the publication of recent scientific test results, the government has banned the sale of product KC. IF KC is produced, it must be disposed of in an approved way that costs $258,000 for every 27,000 units produced. Required: a. Assuming that Kyle Company continues to use the physical quantities method of allocation, what joint costs will be allocated to KA and to KB, respectively? (Do not round intermediate calculations.) Product Joint costs KA KB b. Which, if either, product would you recommend Kyle Company sell at split-off? OOO KA KB None of the above
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