Question
The Green Company processes unprocessed goat milk up to the splitminusoff point where two products, condensed goat milk and skim goat milk result. The following
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The Green Company processes unprocessed goat milk up to the
splitminusoff
point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October:
Direct materials processed: | 102 comma 000102,000 gallons (after shrinkage) | |
Production: | Condensed goat milk | 44 comma 00044,000 gallons |
Skim goat milk | 58 comma 00058,000 gallons | |
Sales: | Condensed goat milk | $ 3.25$3.25 per gallon |
Skim goat milk | $ 2.75$2.75 per gallon |
The costs of purchasing the of unprocessed goat milk and processing it up to the
splitminusoff
point to yield a total of
102 comma 000102,000
gallons of saleable product was
$ 187 comma 480$187,480.
There were no inventory balances of either product. Condensed goat milk may be processed further to yield
43 comma 50043,500
gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of
$ 7$7
per usable gallon. Xyla can be sold for
$ 22$22
per gallon.Skim goat milk can be processed further to yield
56 comma 70056,700
gallons of skim goat ice cream, for an additional processing cost per usable gallon of
$ 7$7.
The product can be sold for
$ 12$12
per gallon. There are no beginning and ending inventory balances.
Using estimated net realizable value, what amount of the joint costs would be allocated Xyla and the skim goat ice cream? (Round intermediary percentage calculations to the nearest hundredth.)
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