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Quiz 02_Solution

# Quiz 02_Solution - 6A:130 Fall 2007 Quiz 2 QUIZ 2 SOLUTION...

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6A:130 – Fall 2007 Quiz 2 QUIZ 2 – SOLUTION ****** Must show work to receive credit. NO WORK NO CREDIT Brant Corporation manufactures two products out of a joint process – Scout and Andro. The joint cost incurred are \$400,000 for a standard production run that generates 70,000 pounds of Scout and 30,000 pounds of Andro. Scout sells for \$9.00 per pound while Andro sells for \$7.00 per pound. 1. If there are no additional processing costs incurred after the splitoff point, the amount of joint cost of each production run allocated to Scout on a physical – quantity basis is a. \$300,000 JTC = \$400,000 x \$70 / (\$70 + \$30) JTC = \$280,000 b. \$280,000 c. \$120,000 d. \$100,000 2. If there are no additional processing costs incurred after the splitoff point, the amount of joint cost of each production run allocated to Andro on a sales value at splitoff basis is a. \$300,000 S > 70 x \$9 = \$630; A > 30 x \$7 = \$210; Total sales = \$840 JTC = \$400,000 x (\$210 / \$840) JTC = \$100,000 b. \$225,000 c. \$175,000 d. \$100,00 3. If additional processing costs beyond the splitoff point are \$1.00 per pound for Scout and \$2.33
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