The Morton Company processes unprocessed goat milk up to the splitoff 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:	65,000 gallons
Production:	condensed goat milk	26,100 gallons
	skim goat milk	32,400 gallons
Sales:	condensed goat milk	$3.50 per gallon
	skim goat milk	$2.50 per gallon

The costs of purchasing the 65,000 gallons of unprocessed goat milk and processing it up to the splitoff point to yield a total of 58,500 gallons of salable product was $72,240.

Condensed goat milk may be processed further to yield 19300 gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of $3 per usable gallon. Xyla can be sold for $18 per gallon.

Skim goat milk can be processed further to yield 28700 gallons of skim goat ice cream, for an additional processing cost per usable gallon of $2.50. The product can be sold for $9 per gallon.

How much of the $72240 joint cost are allocated to the condensed goat milk using the net realizable values?

Correct Answer:	43,931.27

The Morton Company processes unprocessed goat milk up to the splitoff point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October: The costs of purchasing the 65,000 gallons of unprocessed goat milk and processing it up to the splitoff point to yield a total of 58,500 gallons of salable product was $72,240. Condensed goat milk may be processed further to yield 19300 gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of $3 per usable gallon. Xyla can be sold for $18 per gallon. Skim goat milk can be processed further to yield 28700 gallons of skim goat ice cream, for an additional processing cost per usable gallon of $2.50. The product can be sold for $9 per gallon. How much of the $72240 joint cost are allocated to the condensed goat milk using the net realizable values? how did they get that