Question

Sales-Value-at-Split-off Method Alomar Company manufactures four products from a joint production process: barlon, selene, plicene, and corsol. The joint costs for one batch are as follows: Direct materials $67,900 Direct labor 34,000 Overhead 25,500 At the split-off point, a batch yields 1,400 barlon, 2,600 selene, 2,500 plicene, and 3,500 corsol. All products are sold at the split-off point: barlon sells for $15 per unit, selene sells for $20 per unit, plicene sells for $26 per unit, and corsol sells for $35 per unit.
Required:
Allocate the joint costs using the sales-value-at-split-off method. If required, round allocation rates to four decimal places and round the final allocations to the nearest dollar.
Allocated Joint Cost
Barlon $
Selene
Plicene
Corsol
Total $

Answer 1

Answer:

Alomar Company

Allocation of Joint Costs:

Barlon =   $10,270

Selene =  $25,431

Plicene =  $31,789

Corsol =  $59,910

Total =  $127,400

Explanation:

a) Data and Calculations:

Joint costs:

Direct materials    $67,900

Direct labor             34,000

Overhead               25,500

Total joint costs  $127,400

Joint Products             Barlon    Selene     Plicene      Corsol         Total

Batch output units       1,400      2,600       2,500       3,500         10,000

Selling price per unit      $15         $20          $26          $35

Sales value             $21,000  $52,000   $65,000 $122,500  $260,500

Allocation of Joint Costs:

Barlon =   $10,270 ($21,000/$260,500* $127,400)

Selene =  $25,431 ($52,000/$260,500* $127,400)

Plicene =  $31,789 ($65,000/$260,500* $127,400)

Corsol =  $59,910 ($122,500/$260,500* $127,400)