The Alfarm Corporation Processes Raw Milk Up to the Split-Off

Multiple Choice

The Alfarm Corporation processes raw milk up to the split-off point where two products, cream and liquid skim, are produced and sold. There was no beginning inventory. The following material was collected for the month of February:

The cost of purchasing 780,000 gallons of direct materials and processing it up to the split-off point to yield a total of 758,500 gallons of good product was $2,310,000. When using a physical-volume measure, what is the approximate amount of joint costs that will be allocated to cream and liquid skim? (Round intermediary percentages to the nearest hundredth.)

A) $1,350,657 and $959,343
B) $1,155,000 and $1,155,000
C) $1,345,524 and $964,476
D) $1,313,442 and $996,558