Answer the Following Questions Using the Information Below:
Netzone Company $\text { Direct materials processed: } 200 \mathrm{kgs} \text { (Both standard and premium chips weigh } 10 \text { grams each) }$

question 13

Multiple Choice

Answer the following questions using the information below:
Netzone Company is in semiconductor industry and fabrication of silicon-wafer chips splits off two types of memory chips, Standard and Premium. The following information was collected for last quarter of the calendar year:
$\text { Direct materials processed: } 200 \mathrm{kgs} \text { (Both standard and premium chips weigh } 10 \text { grams each) }$
$\begin{array}{lll}\text { Production: } & \text { Standard } & 10,000 \text { chips } \\& \text { Premium } & 6,500 \text { chips } \\\text { Sales: } & \text { Standard } & 9,500 \text { at } \$ 100 \text { per chip } \\& \text { Premium } & 6,000 \text { at } \$ 170 \text { per chip }\end{array}$ The cost of purchasing 200 kgs of direct materials and processing it up to the splitoff point to yield a total of 16,500 chips of good products was $1,950,000.
Beginning inventories totalled 100 chips for Standard and 50 chips for Premium. Ending inventory amounts reflected 100 chips of Standard and 50 chips of Premium. October costs per unit were the same as November.
-When using a physical-volume measure,what is the approximate amount of joint costs that will be allocated Standard chips?

• A) $1,170,000
• B) $1,818,818
• C) $975,000
• D) $1,181,818

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses, including taxes, from its total revenues.

Average Assets

A financial measure used to calculate the average total assets a company has had at its disposal over a certain period, often used in evaluating asset efficiency and ROI calculations.

Net Sales

The revenue a company makes after subtracting returns, allowances for damages or missing items, and discounts from its total sales.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership equity.