Old Virginia Meat Processing Plant Processes Hogs to Produce Three

question 101

Essay

Old Virginia Meat Processing Plant processes hogs to produce three joint products: bacon,sausage,and pork chops.The company incurs common processing costs of $100,000 per batch.Each batch yields 15,000 pounds of bacon,18,000 pounds of sausage,and 7,000 pounds of pork chops.Pork chops can be sold for $3.00 per pound.The bacon and sausage products are sold at the split-off point for $3.25 per pound and $3.50 per pound,respectively.
Required:
1)Allocate Old Virginia's joint costs using pounds produced as the allocation base.(Do not round intermediate calculations.)
2)Allocate Old Virginia's joint costs using the relative sales value at split-off method.(Do not round intermediate calculations.)
3)Assume that the pork chops are processed further after the split-off point at an additional cost of $4,000 and that joint costs are allocated based on pounds produced.What would be the total cost assigned to pork chops?

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Definitions:

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