The South Oil Company buys crude vegetable oil Refining this oil results in four products at the split off point A, B C and D Product C is fully processed by the spilt of F point Products A B and D can individually be further refined into Super A. Super B and Super D Data related to December are: Requirements 1. Compute the gross margin percentage for each product sold in December, using the following methods for allocating the S80.000 joint costs: a. Sales value at split off b. Physical measure c. NRV 2 Could South have increased its December operating income by making different decisions about the further processing of products A. B, or 0? Show the effect on operating income of any changes you recommend. Requirement 1. Compute the gross margin percentage for each product sold in December, using the different methods for allocating the $80.000 joint costs. a Sales Value at Split off. Begin by entering the amounts in the table and allocate the joint costs. (Enter the weightings to four decimal places.) Compute the gross margin percentage using the sales value at split off method to allocate the joint costs. (Enter an amount in each input cell Round the percentages to two decimal places. X.XX%. Use parentheses or a minus sign when entering negative amounts) b. Allocate the joint costs using the physical-measure method Enter the amounts in the table and allocate the joint costs. (Enter the weightings to four decimal places.) Compute the gross margin percentage using the physical-measures method to allocate the joint costs (Enter an amount in each input cell Round the percentages to two decimal places. X XX%. Use parentheses or a minus sign when entering negative amounts) c. Allocate the joint costs using the net realizable value method. Enter the amounts in the table and allocate the joint costs. (Enter the weightings to four decimal places.) Compute the gross margin percentage using the NRV method to allocate the joint costs. (Enter an amount in each input cell. Round the percentages to two decimal places, X.XX%. Use parentheses or a minus sign when entering negative amounts) Requirement 2. Could South have increased its December operating income by making different decisions about the further processing of products A. B. or D? Show the effect on operating income of any changes you recommend Determine the formula you will use to make your decision Then enter the amounts for each product and determine the effect on operating income of the decision (Enter negative effects with parentheses or a minus sign.) Requirement 2. Could South have increased its December operating income by making different decisions about the further processing of products A, B. or D? Show the effect on operating income of any changes you recommend Determine the formula you will use to make your decision. Then enter the amounts for each product and determine the effect on operating income of the decision. (Enter negative effects with parentheses or a minus sign.)
