Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
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Sky airlines produces two different aircrafts. The joint process incurs costs of $10 million. Both aircrafts can be sold at split-off or processed further to increase the final sales value. The following information is related to the two products. (all costs are recorded in millions)
Product | Units | Weight per Unit (lbs) | Final Sales Value | Further |
Sales Value at Split-Off |
B752 | 15 | 90,000 | $420 | $200 | $230 |
B797 | 25 | 110,000 | 480 | 260 | 310 |
If the sales price at split-off provided is reliable, what is the gross margin for B797, using the appropriate method of allocation?
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