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Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
Edition 2ISBN: 978-1111824402Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
Edition 2ISBN: 978-1111824402 Exercise 45
Allocating Joint Costs Using the Sales-Value-at-Split-Off Method
Refer to Cornerstone Exercise 7.7. Assume that Orchard Fresh, Inc., uses the sales-value-atsplit- off method of joint cost allocation and has provided the following information about the four grades of apples:
Total joint cost is $18,000.
Required:
1. Allocate the joint cost to the four grades of apples using the sales-value-at-split-off method. (Carry out the percent calculations to four significant digits. Round all cost allocations to the nearest dollar.)
2. What if the price at split-off of Grade B apples increased to $1.20 per pound? How would that affect the allocation of cost to Grade B apples? How would it affect the allocation of cost to the remaining grades?
Refer to Cornerstone Exercise 7.7. Assume that Orchard Fresh, Inc., uses the sales-value-atsplit- off method of joint cost allocation and has provided the following information about the four grades of apples:
Total joint cost is $18,000.
Required:
1. Allocate the joint cost to the four grades of apples using the sales-value-at-split-off method. (Carry out the percent calculations to four significant digits. Round all cost allocations to the nearest dollar.)
2. What if the price at split-off of Grade B apples increased to $1.20 per pound? How would that affect the allocation of cost to Grade B apples? How would it affect the allocation of cost to the remaining grades?
Explanation
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Orchard fresh, Inc. purchases apples fro...
Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
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