Scotland Beauty Products Manufactures Face Cream, Body Lotion, and Liquid

question 164

Essay

Scotland Beauty Products manufactures face cream, body lotion, and liquid soap in a joint manufacturing process. At the split-off point, the company has 300 pounds of face cream with a market value of $15 per pound, 200 pounds of body lotion with a market value of $13 per pound, and 300 pounds of liquid soap with a market value of $7 per pound and has incurred $200,000 in joint costs. The net realizable value (NRV) of the face cream is $7,500, the NRV of the body lotion is $3,500, and the NRV of the liquid soap is $4,000.Using the net realizable value method, allocate the joint costs to (a) face cream, (b) body lotion, and (c) liquid soap. Round percentages in intermediate steps to the nearest whole percentage.

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Definitions:

Erik Erikson

A developmental psychologist known for his theory of psychosocial development, which outlines eight stages of psychological growth from infancy to adulthood.

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The act of using someone else's work or ideas without proper acknowledgment or permission.

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An assertion concerning what will occur in a particular research investigation.