Answer the Following Questions Using the Information Below:
the Alfarm

question 49

Multiple Choice

Answer the following questions using the information below:
The Alfarm Corporation processes raw milk up to the splitoff point where two products, cream and liquid skim, are produced and sold. There was no beginning inventory. The following material was collected for the month of February:
$\begin{array}{lll}\text { Direct materials processed: } && 750,000 \text { gallons }(727,500 \text { gallons of good product) } \\\text { Production: } & \text { Cream } & 442,500 \text { gallons } \\& \text { Liquid skim } & 285,000 \text { gallons } \\\text { Sales: } & \text { Cream } & 421,500 \text { at } \$ 110 \text { per gallon } \\& \text { Liquid skm } & 273,000 \text { at } \$ 100 \text { per gallon }\end{array}$ The cost of purchasing 750,000 gallons of direct materials and processing it up to the splitoff point to yield a total of 727,500 gallons of good product was $2,280,000.
-When using the physical-volume method,what is Cream's approximate production cost per gallon?

• A) $3.03
• B) $3.31
• C) $3.13
• D) $3.21

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Definitions:

Zymogen Granules

Intracellular storage granules found in the pancreas and other glands, containing inactive enzyme precursors that can be activated when needed.

Salivary Amylase

An enzyme found in saliva that starts the process of breaking down starches into sugars during digestion.

Pyloric Pump

A mechanism involving the pylorus, the region of the stomach that connects to the small intestine, which regulates the passage of digestive contents into the intestine.

Pyloric Opening

The opening from the stomach into the duodenum, regulated by the pyloric sphincter to control the passage of digested food.