Acct434 Advanced Cost Management Week 4 Homework (Red Sauce Canning, Zenon Chemical, Oregon Lumber)

Acct434 Advanced Cost Management Week 4 Homework (Cost Allocation) – Version 2 Problem 1: Red Sauce Canning Company processes tomatoes into catsup, tomato juice, and canned tomatoes. During the summer of 20X2, the joint costs of processing the tomatoes were $420,000. There was no beginning or ending inventories for the summer. Production and sales value information for the summer is as follows: Product Cases Sales Value at Splitoff Point Separable Costs Selling PriceCatsup 100,000 6 per case $3.00 per case 28er caseJuice 150,000 8 per case 5.00 per case 25 per caseCanned 200,000 5 per case 2.50 per case 10 per case Question 1: Determine the amount allocated to each product if the estimated net realizable value method is used, and compute the cost per case for each product (10 Points) Problem 2: Zenon Chemical, Inc. processes pine rosin into three products: turpentine, paint thinner, and spot remover. During May, the joint costs of processing were $240,000. Production and sales value information for the month is as follows: Product Units Produced Sales Value at Splitoff Point Turpentine 6,000 liters 60,000 Paint thinner 6,000 liters 50,000 Spot remover 3,000 liters 25,000 Question: Determine the amount of joint cost allocated to each product if the physical-measure method is used. Problem 3: Oregon Lumber processes timber into four products. During January, the joint costs of processing were $280,000. There was no inventory at the beginning of the month. Production and sales value information for the month is as follows: Product Board feet Sales Value at Splitoff Point Ending Inventory 2 x 4’s 6,000,000 0.30 per board foot 500,000 bdft. 2 x 6’s 3,000,000 0.40 per board foot 250,000 bdft. 4 x 4’s 2,000,000 0.45 per board foot 100,000 bdft. Slabs 1,000,000 0.10 per board foot 50,000 bdft. Question: Determine the value of ending inventory if the sales value at splitoff method is used for product costing. Round to three decimal places when necessary. (10 Points)