Managerial Accounting: Creating Value in a Dynamic Business Environment
12th Edition
ISBN: 9781260417074
Author: HILTON, Ronald
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 17, Problem 20E
Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows:
Required: Use the physical-units method to allocate the company’s joint production cost between Yummies and Crummies.
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Fordham Corporation produces a single product. The standard costs for one unit of its Concourse product are as follows:
Required information
(The following information applies to the questions displayed below)
Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as
follows.
Quantity at
Split-off Point
12,700 kilograns
8,700 kilograns
Sales Peice
per Kilogram
56.70
8.20
Cereal
Joint Cost
597, 000
Yumnies
Crumnies
Breakfasttime Cereal Company has an opportunity to process its Crummies further into a mulch for ornamental shrubs
The additional processing operation costs $2.20 per kilogram, and the mulch will sell for $14.00 per kilogram.
2. Suppose the company does process Crummies into the mulch. Use the net-realizable-value method to allocate the joint production
cost between the mulch and the Yummies. (Round intermediate calculations of "Relative Proportions" to 3 decimal places and final
answers to the nearest dollar amount.)
Answer is complete but not entirely correct.
Allocation of
Joint Cost
Yummies
57,521 8
Mulch
44,237 O
Mephis Manufacturing has a manufacturing process that results in four separate products that together incur some portion of joint costs. If the appropriate split-off point is determined to be at the third stage in the production process, how will the costs incurred after the third stage be accounted for?
Chapter 17 Solutions
Managerial Accounting: Creating Value in a Dynamic Business Environment
Ch. 17 - Prob. 1RQCh. 17 - Prob. 2RQCh. 17 - Should actual or budgeted service department costs...Ch. 17 - Prob. 4RQCh. 17 - Why does dual cost allocation improve the...Ch. 17 - What potential behavioral problem can result when...Ch. 17 - Should actual or budgeted service department costs...Ch. 17 - Explain the difference between two-stage...Ch. 17 - Define the following terms: joint production...Ch. 17 - Prob. 10RQ
Ch. 17 - Describe the relative-sales-value method of joint...Ch. 17 - Define the term net realizable value, and explain...Ch. 17 - Are joint cost allocations useful? If they are,...Ch. 17 - For what purpose should the managerial accountant...Ch. 17 - Prob. 15ECh. 17 - Refer to the data given in the preceding exercise....Ch. 17 - Tuscaloosa National Bank has two service...Ch. 17 - Refer to the data given in the preceding exercise....Ch. 17 - Breakfasttime Cereal Company manufactures two...Ch. 17 - Refer to the data given in the preceding exercise....Ch. 17 - Refer to the data given in Exercise 1720....Ch. 17 - Prob. 23ECh. 17 - Prob. 24PCh. 17 - Prob. 25PCh. 17 - Celestial Artistry Company is developing...Ch. 17 - Snake River Sawmill manufactures two lumber...Ch. 17 - Travelcraft Company manufactures a complete line...Ch. 17 - Biondi Industries is a manufacturer of chemicals...Ch. 17 - Berger Company manufactures products Delta, Kappa,...Ch. 17 - Prob. 31PCh. 17 - Lafayette Company manufactures two products out of...Ch. 17 - Refer to the data given in Problem 1726 for...Ch. 17 - Prob. 34PCh. 17 - Top Quality Fruit Company, based on Oahu, grows,...Ch. 17 - Prob. 36C
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