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The Sunny Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point. A, B, C, and D. Product
The Sunny Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point. A, B, C, and D. Product C is fully processed by the splitoff point. Products A, B, and D can individually be further refined into Super A. Super B, and Super D. In the most recent month (December), the output at the splitoff point was as follows: (Click the icon to view the information.) Read the requirements Requirement 1. Compute the gross-margin percentage for each product sold in December, using the different methods for allocating the $100,000 joint costs. a. Sales Value at Splitoff. Begin by entering the amounts in the table and allocate the joint costs. (Enter the weights to four decimal places. Sales value of total Joint costs More info production at splitoff Weighting allocated A Product A, 300,000 gallons Product B, 100,000 gallons B Product C, 50,000 gallons Product D, 50,000 gallons D The joint costs of purchasing and processing the crude vegetable oil were $100,000. Sunny had no beginning or ending inventories. Sales of product C in December were $50,000. Products A, B, and D were further refined and then sold. Data related to December are as follows: Separable Processing Costs to Requirements Make Super Products Revenues Super A 100.000 $ 200,000 ecember 1. Compute the gross-margin percentage for each product sold ir Super B 80.000 100,000 using the following methods for allocating the $100,000 joint costs: Super D 95,000 125,000 a. Sales value at splitoff Sunny had the option of selling products A, B, and D at the splitoff point. This b. Physical-measure alternative would have yielded the following revenues for the December NRV production: 2. Could Sunny have increased its December operating income by making Product A, $50,000 different decisions about the further processing of products A, B, or D? Show Product B, $30,000 the effect on operating income of any changes you recommend. Product D, $70,000 c
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