Luxury Company Processes Copper Ore into Two Products,C and U

question 29

Multiple Choice

Luxury Company processes copper ore into two products,C and U.The ore costs $5 per pound and conversion costs are $15 per pound.Luxury Company plans to produce 40,000 pounds of Product C and 20,000 pounds of Product U from 60,000 pounds of ore.Product C sells for $30 per pound and Product U sells for $40 per pound.Assume the company uses the physical-units method of allocating joint costs.What amount of joint costs is allocated to Product U?

• A)$0
• B)$100,000
• C)$300,000
• D)$400,000