Isthmus Corporation Uses the Physical-Units Method to Allocate Costs Among

question 4

Multiple Choice

Isthmus Corporation uses the physical-units method to allocate costs among its three joint products: X, Y, and Z. The following data are available for the period just ended:
Joint processing cost: $800,000
Total production: 150,000 pounds
Share of joint cost allocated to X: $160,000
Share of joint cost allocated to Y: $400,000
Which of the following statements is true?

• A) The company would have relied on the sales value of each product when allocating joint costs to X, Y, and Z.
• B) Ithaca produced 30,000 pounds of Z during the period.
• C) Ithaca produced 45,000 pounds of Z during the period.
• D) Ithaca produced 105,000 pounds of Z during the period.
• E) Based on the data presented, it is not possible to determine Ithaca's production of Z during the period.

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