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Thornton Chemical Company makes three products, B7, K6, and X9,which are joint products from the same materials. In a standardbatch of 306,000 pounds of raw materials, the company generates73,000

Thornton Chemical Company makes three products, B7, K6, and X9,which are joint products from the same materials. In a standardbatch of 306,000 pounds of raw materials, the company generates73,000 pounds of B7, 150,000 pounds of K6, and 83,000 pounds of X9.A standard batch costs $2,448,000 to produce. The sales prices perpound are $6, $12, and $14 for B7, K6, and X9, respectively.

Required

Allocate the joint product cost among the three final productsusing weight as the allocation base.

Allocate the joint product cost among the three final productsusing market value as the allocation base.

  • Required A
  • Required B

Allocate the jointproduct cost among the three final products using weight as theallocation base.

 
 
 
 
Product Allocation Rate x Weight of Base = Allocated Cost
B7 x = $0
K6 x = 0
X9 x   = 0
Total allocated cost       $0

Allocate the jointproduct cost among the three final products using market value asthe allocation base. (Round"Allocation rate" to 2 decimal places.)

 
 
 
 
Product Allocation Rate x Weight of Base = Allocated Cost
B7 x = $0
K6 x = 0
X9 x = 0
Total allocated cost         $0
 
 

 

Jun 06 2021 View more View Less

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