Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
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Question
Chapter 5, Problem 3MAD
a.
To determine
Identify the flavors Company J should discontinue to further process after the split-off.
b.
To determine
Identify the flavor the Company J should keep apart from pure orange flavor.
c.
To determine
Compute the amount of joint production costs allocated to each product using the net realization value method.
d.
To determine
Identify how Company J could record the revenue from the sale of the by-product.
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Spirit Company blends and sells designer fragrances. It has a Men's Fragrances Division and a Women's Fragrances Division, each with different sales strategies, distribution channels, and product
offerings. Spirit is now considering the sale of a bundled product called Sync, consisting of one bottle of Him, a men's cologne, and one bottle of Her, a women's perfume, two of Spirit's very
successful products. Spirit sells equal quantities of Him and Her perfume. For the most recent year, Spirit reported the following:
(Click the icon to view the sales information.)
Read the requirements.
Requirement 1a. Allocate revenue from the sale of each unit of Sync to Him and Her using the following:
a. The stand-alone revenue-allocation method based on selling price of each product. (Do not round intermediary calculations. Only round the amount you input in the cell to the nearest dollar.)
Stand-alone
Him
Her
Spirit Company blends and sells designer fragrances. It has a Men's Fragrances Division and a Women's Fragrances Division, each
with different sales strategies, distribution channels, and product offerings. Spirit is now considering the sale of a bundled product
called Sync, consisting of one bottle of Him, a men's cologne, and one bottle of Her, a women's perfume, two of Spirit's very
successful products. Spirit sells equal quantities of Him and Her perfume. For the most recent year, Spirit reported the following:
(Click the icon to view the sales information.)
Read the requirements.
Data table
$ 80.00
LE
$
Sync (Him and Her) $ 130.00
Product
Him
Her
Retail Price
120.00
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Chapter 5 Solutions
Managerial Accounting
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