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

Acct434 Advanced Cost ManagementWeek 4 Homework (Cost Allocation)  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 Price Catsup 125,000 $6.25 per case $3.20 per case $29.00 per case Juice 175,000 $8.25 per case 5.20 per case $26.25 per case Canned 250,000 $5.25 per case 2.70 per case $11.00 per case Question: 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 June, the joint costs of processing were $380,000. Production and sales value information for the month is as follows: Product Units Produced Sales Value at Splitoff Point Turpentine 8,500 liters 85,000 Paint thinner 6,500 liters 55,250 Spot remover 4,000 liters 34,000 Question: Determine the amount of joint cost allocated to each product if the physical-measure method is used. (10 points)Problem 3: Oregon Lumber processes timber into four products. During February, the joint costs of processing were $380,000. 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 6,500,000 0.35 per board foot 650,000 bdft. 2 x 6’s 3,500,000 0.45 per board foot 280,000 bdft. 4 x 4’s 2,500,000 0.50 per board foot 100,000 bdft. Slabs 1,500,000 0.20 per board foot 75,000 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)