Mel Corporation manufactures liquid chemicals X and Y from a joint process. Joint costs are allocated on the basis of relative market value at split-off. It costs Php5,000 to process 500 gallons of Product X and 1,000 gallons of Product Y to the split-off point. The market value at split-off is Php10 per gallon for Product X and Php15 for Product Y. Product Y requires an additional process beyond split-off at a cost of Php5 per gallon before it can be sold. What is Mel’s cost to produce 1,000 gallons of Product Y?
Mel Corporation manufactures liquid chemicals X and Y from a joint process. Joint costs are allocated on the basis of relative market value at split-off. It costs Php5,000 to process 500 gallons of Product X and 1,000 gallons of Product Y to the split-off point. The market value at split-off is Php10 per gallon for Product X and Php15 for Product Y. Product Y requires an additional process beyond split-off at a cost of Php5 per gallon before it can be sold. What is Mel’s cost to produce 1,000 gallons of Product Y?
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter19: Support Department And Joint Cost Allocation
Section: Chapter Questions
Problem 4CMA: Tucariz Company processes Duo into two joint products, Big and Mini. Duo is purchased in...
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Mel Corporation manufactures liquid chemicals X and Y from a joint process. Joint costs are allocated on the basis of relative market value at split-off. It costs Php5,000 to process 500 gallons of Product X and 1,000 gallons of Product Y to the split-off point. The market value at split-off is Php10 per gallon for Product X and Php15 for Product Y. Product Y requires an additional process beyond split-off at a cost of Php5 per gallon before it can be sold. What is Mel’s cost to produce 1,000 gallons of Product Y?
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