The Mallak Company Produced Three Joint Products at a Joint

question 99

Multiple Choice

The Mallak Company produced three joint products at a joint cost of $100,000.Two of these products were processed further.Production and sales were:
$$\begin{array} { | l | c | r | r | } \hline & \text { Veight } & \text { Sales } & \text { Adit. Processing Costs } \\\hline \mathrm { P } & 300,000 \mathrm { ks } . & \$ 245,000 & \$ 200,000 \\\hline \mathrm { Q } & 100,000 \mathrm { ks } . & 30,000 & - 0 \\\hline \mathrm { R } & 100,000 \mathrm { ks } . & 175,000 & 100,000 \\\hline\end{array}$$ Assume Q is a by-product and Mallak uses the cost reduction method of accounting for by-product cost.If estimated net realizable value is used,how much of the joint costs would be allocated to product R?

• A) $38,889.
• B) $43,750.
• C) $50,000.
• D) $62,500.

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