Use the Following Information for the Next 5 Questions

question 97

Multiple Choice

Use the following information for the next 5 questions.
The Great Foods Company processes milk into skim milk and butter. This year 70,000 gallons of will be processed, costing $40,000. If processed to the split-off point, this will yield 40,000 gallons of skim milk and 10,000 pounds of butter. Skim milk is sold to distributors for $1 per gallon and butter is sold for $0.75 per pound. Great Foods has the option of processing the two products further. Skim milk can be processed into canned, sweetened, condensed skim milk and sold for $0.80 per can. One gallon of skim milk makes 2 cans of condensed milk. To process 40,000 gallons of skim milk will cost $18,000. Butter can be processed into cake frosting, sold in containers for $2 each. One pound of butter goes into each container of frosting. The cost of processing 10,000 pounds of butter into frosting costs $15,000.
-What is the per-unit joint cost allocated to condensed milk and frosting under the physical output method if the number of units of output after further processing is used to measure output?

• A) $0.69524 per can and $1.7381 per container
• B) $0.4444 per can and $0.4444 per container
• C) $1.3905 per can and $1.7381 per container
• D) None of the above

---

Definitions:

Ingroup Favoritism

The tendency to favor members of one's own group over those from different groups.

Stereotype Threat

The risk of confirming negative stereotypes about one's group, which can impair performance.

Intellectual Performance

The efficiency or skill level shown by an individual in tasks that require cognitive effort, such as problem-solving, abstract thinking, and understanding complex ideas.

Self-fulfilling Prophecy

A prediction that directly or indirectly causes itself to become true, due to positive feedback between belief and behavior.