Algonquin Products Produces Two Products, X and Y, in a Single

question 101

Multiple Choice

Algonquin Products produces two products, X and Y, in a single process. In 2011, the joint costs of this process were $25,000. In addition, 4,000 units of X and 6,000 units of Y were produced. Separable processing costs beyond the split-off point were X-$10,000; Y-$20,000. X sells for $10.00 per unit; Y sells for $7.50 per unit.
What is the gross profit of product Y assuming the net realizable value method is used?

• A)$45,000
• B)$16,364
• C)$13,636
• D)$30,000

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Definitions:

Common Soap

A detergent made from fats and an alkali, used for cleaning through its ability to remove dirt and grease.

Fatty Acids

Long chain carboxylic acids, often found in fats and oils, serving as important sources of energy for the body and as components of cell membranes.

Melting Point

The temperature at which a solid becomes a liquid at atmospheric pressure.

Prostaglandins

A collection of active lipid molecules that exhibit various hormone-like functions in animals.