The Killian Company manufactures two skin care lotions, Liquid Skin and Silken Skin, out of a joint process.  The joint (common) costs incurred are $420,000 for a standard production run that generates 180,000 gallons of Liquid Skin and 120,000 gallons of Silken Skin.  Liquid Skin sells for $2.40 per gallon while Silken Skin sells for $3.90 per gallon. Assuming both products are sold at the split-off point, the amount of joint cost of each production run allocated to Liquid Skin on a net realizable value is? If there are additional costs are incurred after the split-off point, the amount of joint cost of each production run allocated to Silken Skin on a physical-quantity basis is?

Atlas Foods produces three supplemental food products simultaneously through a refining process costing $85,000. The joint products, Alfa and Betters, have a final selling price of $8 per pound and $5 per pound, respectively, after additional processing costs of $3 per pound of each product are incurred after the split-off point. Morefeed, a by-product, is sold at the split- off point for $2.50 per pound. Additional information are as follows: Alfa - 15,000 pounds of Alfa, a popular but relatively rare grain supplement of having a caloric value of 8,800 calories/pound. Betters - 5,000 pounds of Betters, a flavouring material high in carbohydrates with a caloric value of 12,000 calories/pound. Morefeed - 2,000 pounds of Morefeed, used as a cattle feed supplement with a caloric value of 1,000 calories/pound. Questions: 1. Assuming Atlas Foods does not inventory Morefeed, the by-product, the joint cost to be allocated to Betters using the net realizable method is?

Oat Treats manufactures various types of cereal bars featuring oats. Simmons Cereal Company has approached Oat Treats with a proposal to sell the company its top selling oat cereal bar at a price of $27,500 for 20,000 bars. The costs shown are associated with production of 20,000 oat bars currently:   The manufacturing overhead consists of $3,000 of variable costs with the balance being allocated to fixed costs. PLEASE NOTE: Costs per unit are rounded to two decimal places and shown with "$" and commas as needed (i.e. $1,234.56). All other dollar amounts are rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).   What is Oat Treats' relevant cost?  What does Simmons Cereal's offer cost?  If Oat Treats accepts the offer, what will the effect on profit be? Incremental dollar amount =  _________ Increase or Decrease?  . ___________ Please note: Your answer is either "Increase" or "Decrease" - capital first letters and no quotes.

Talbot Industries manufactures two models of wireless headset: TI-12 and TI-28. Each product requires time on a single machine. The machine has a monthly capacity of 540 hours. Total market demand for the two products is limited to 2,000 units of TI-12 and 1,000 units of TI-28 monthly. Talbot is currently producing and selling 1,500 TI-12 models and 780 TI-28 models each month. Cost and machine-usage data for the two products are shown in the following spreadsheet, which analysts at Talbot use for production planning purposes: Price Less variable costs per unit Material Labor Overhead Contribution margin per unit Fixed costs Manufacturing Marketing and administrative Machine hours per unit Machine hours used Machine hours available Quantity produced Maximum demand Profit TI-12 $ 80 Required A Required B 23 29 8 $ 20 0.1

Reuben's Deli currently makes rolls for deli sandwiches it produces. It uses 33,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Materials $0.23 per roll Labor 0.40 per roll Variable overhead 0.15 per roll Fixed overhead 0.20 per roll A potential supplier has offered to sell Reuben the rolls for $0.88 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. If Reuben accepts the offer, what will the effect on profit be? Reuben would see a $ in profit if he buys the rolls.

The Compressor Division and the Fabrication Division of Plash Company, which exclusively produces one type of washing machine, respectively, are its two divisions. For the Fabrication Division, which completes the washing machine and sells it to retailers, the Compressor Division makes compressors. The Fabrication Division buys compressors from the Compressor Division. The Fabrication Division will spend $40.00 on a compressor, which is the market price. (Skip updates to the inventory.) It is expected that the fixed costs for the Compressor Division remain constant for orders between 5,000 and 10,000 units. The Fabrication Division's fixed expenses are estimated to be $7.50 per unit at 10,000 units. Compressor's costs per compressor are: Direct materials $15.00 Direct labor $7.25 Variable overhead $3.00 Division fixed costs $7.50 Fabrication's costs per completed air conditioner are: Direct materials $150.00 Direct labor $62.50 Variable overhead $20.00 Division fixed costs $7.50 Assume…

Kingston Specialty Corporation manufactures joint products P and Q. During a recent period, joint costs amounted to $90,000 in the production of 20,000 gallons of P and 50,000 gallons of Q. Kingston can sell P and Q at split-off for $2.00 per gallon and $2.20 per gallon, respectively. Alternatively, both products can be processed beyond the split-off point, as follows:   P Q Separable processing costs $ 22,000 $ 42,000 Sales price (per gallon) if processed beyond split-off $ 4 $ 6 what woulkd be the joint cost allocated to Q under the relative-sales-value method ? Note: Do not round intermediate calculations.

Gunston Processing produces two products, ALT-1 and ALT-2, from a batch using a single raw material, ALT-O. Both products require further processing before they be can be sold. A batch of ALT-1 can be sold for $150,000 after processing costs of $30,000. A batch of ALT-2 can be sold for $240,000 after further processing. The cost of ALT-0 is $200,000 for a batch. Using the estimated net realizable value method, a joint cost of $120,000 was allocated to ALT-2 for a batch. Required: Compute the separable processing cost for a batch of ALT-2. Processing cost hs

Reuben's Deli currently makes rolls for deli sandwiches it produces. It uses 31,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Materials $0.24 per roll Labor 0.39 per roll Variable overhead 0.16 per roll Fixed overhead 0.20 per roll A potential supplier has offered to sell Reuben the rolls for $0.89 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. If Reuben accepts the offer, what will the effect on profit be? decline in profit if he buys the rolls. Reuben would see a $

Colt Company owns a machine that can produce two specialized products. Production time for Product TLX is three units per hour and for Product MTV is five units per hour. The machine’s capacity is 2,600 hours per year. Both products are sold to a single customer who has agreed to buy all of the company’s output up to a maximum of 4,420 units of Product TLX and 5,995 units of Product MTV. Selling prices and variable costs per unit to produce the products follow.  $ per unit Product TLX Product MTV Selling price per unit   $ 11.50     $ 6.90   Variable costs per unit     3.45       4.14     Determine the company's most profitable sales mix and the contribution margin that results from that sales mix. (Round per unit contribution margins to 2 decimal places.)