70.2K

Verified Solution

Link Copied!

Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are $$410,000$ for a standard production run that generates $260,000$ pints of Smooth Skin and $140,000$ pints of Silken Skin. Smooth Skin sells for $$3\mathrm{.}10$ per pint, while Silken Skin sells for $$4\mathrm{.}10$ per pint.

Required:

$1.$ Assuming that both products are sold at the split$-$off point, how much of the joint cost of each production run is allocated to Smooth Skin using the relative sales value method?

$2.$ If no separable costs are incurred after the split$-$off point, how much of the joint cost of each production run is allocated to Silken Skin using the physical measure method?

$3.$ If separable processing costs beyond the split$-$off point are $$1\mathrm{.}60$ per pint for Smooth Skin and $$1\mathrm{.}70$ per pint for Silken Skin, how much of the joint cost of each production run is allocated to Silken Skin using a net realizable value method?

$4.$ If separable processing costs beyond the split$-$off point are $$1\mathrm{.}60$ per pint for Smooth Skin and $$1\mathrm{.}70$ per pint for Silken Skin, how much of the joint cost of each production run is allocated to Smooth Skin using a physical measure method?

$($For all requirements, do not round intermediate calculations. Round final answers to nearest whole dollar amounts.$)$

Answer & Explanation Solved by verified expert

See Answer