Terrace Labs produces a drug used for the treatment ofarthritis. The drug is produced in batches.
In March?, Terrace?,which had no opening? inventory, processedone batch of chemicals. It sold 2,100 gallons of product for humanuse and 500 gallons of the veterinarian product. Terrace uses thenet realizable value method for allocating joint productioncosts.
Chemicals costing $54,000 are mixed and? heated, then a uniqueseparation process then extracts the drug from the mixture. A batchyields a total of 2,800 gallons of the chemicals. The first 2,200gallons are sold for human use while the last 600 ?gallons, whichcontain? impurities, are sold to veterinarians. The costs of?mixing, heating, and extracting the drug amount to $153,000 perbatch. The output sold for human use is pasteurized at a total costof $123,200 and is sold for $640 per gallon. The product sold toveterinarians is irradiated at a cost of $15 per gallon and is soldfor $480 per gallon.
Requirement 1. How much in joint costs does Terrace allocate toeach? product? ?(Do not round intermediary calculations. Only roundthe amount you input in the cell to the nearest? dollar.)
Joint costs allocated to human product | |
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Joint costs allocated to veterinarian product | |
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