17-21JOINT-COST ALLOCATION, INSURANCE SETTLEMENT. Quality Chicken grows andprocesses chickens. Each chicken is disassembled into five main parts. Information pertainingto production in July 2020 follows:PartsWholesale Selling Price per Pound WhenPounds of ProductBreasts100Wings20Thighs40Bones80Feathers10Production Is Complete$0.550.200.350.100.05Joint cost of production in July 2020 was $50.A special shipment of 40 pounds of breasts and 15 pounds of wings has been destroyed in afire. Quality Chicken's insurance policy provides reimbursement for the cost of the itemsdestroyed. The insurance company permits Quality Chicken to use a joint-cost-allocationmethod. The splitoff point is assumed to be at the end of the production process.Required1. Compute the cost of the special shipment destroyed using the following:a. Sales value at splitoff methodb. Physical-measure method (pounds of finished product)2. What joint-cost-allocation method would you recommend Quality Chicken use? Explain.

1a. Sales value at splitoff method:In this method, the joint cost is allocated to the different…

Answered: 17-21 JOINT-COST ALLOCATION, INSURANCE…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Quality Chicken grows and processes chickens. Each chicken is disassembled into five main parts. Information pertaining to production in July 2020 follows: (Click the icon to view the information.) Joint cost of production in July 2020 was $50. Data table Parts Breasts Wings Thighs Bones Feathers Pounds of Wholesale Selling Price per Pound Product When Production is Complete 100 $ 20 40 80 10 Print Done 0.55 0.20 0.35 0.10 0.05 X A special shipment of 40 pounds of breasts and 15 pounds of wings has been destroyed in a fire. Quality Chicken's insurance policy provides reimbursement for the cost of the items destroyed. The insurance company permits Quality Chicken to use a joint-cost-allocation method. The splitoff point is assumed to be at the end of the production process. Read the requirements. Requirements 1. Compute the cost of the special shipment destroyed using the following: a. Sales value at splitoff method b. Physical-measure method (pounds of finished product) 2. What…
Peter Company makes a high-end Appliance, Y45. Peter presents the following data for the years 2019 and 2020: Units of Y45 produced and sold Selling price Direct materials (square feet) Direct materials costs per square foot Manufacturing capacity in units of Y45 Total conversion costs 2019 100,000 $1,000 300,000 $100 125,000 2020 105,000 $1,100 307,500 $110 125,000 $12,500,000 $13,750,000 $110 Conversion costs per unit of capacity Selling and customer-service capacity (customers) Total selling and customer-service costs Selling and customer-service capacity cost per customer $100 300 300 $4,500,000 $15,000 $4,687,500 $15,625 Peter produces no defective units but it wants to reduce direct materials usage per unit of Y45. Manufacturing conversion costs in each year depend on production capacity defined in terms of Y45 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Peter had…
Peter Company makes a high-end Appliance, Y45. Peter presents the following data for the years 2019 and 2020: Units of Y45 produced and sold Selling price Direct materials (square feet) Direct materials costs per square foot Manufacturing capacity in units of Y45 Total conversion costs 2019 100,000 $1,000 300,000 $100 2020 105,000 $1,100 307,500 $110 125,000 $12,500,000 $13,750,000 $100 125,000 Conversion costs per unit of capacity Selling and customer-service capacity (customers) Total selling and customer-service costs Selling and customer-service capacity cost per customer $15,000 $110 300 300 $4,500,000 $4,687,500 $15,625 Peter produces no defective units but it wants to reduce direct materials usage per unit of Y45. Manufacturing conversion costs in each year depend on production capacity defined in terms of Y45 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Peter had…
Atlantis Company is placing an ad in the local paper to advertise its products . The ad will run for one week at a total cost of P5,500. Atlantis Company has four categories of products as follows: Product category % of floor space Expected sales occupied value A 20 P35,000 1515,000 45 64,500 D 2025,500 What amount of advertising cost should be allocated to product category A, assuming Atlantis allocates based on percent of floor space occupied ?
Buggs-Off Corporation produces and sells a line of mosquito repellants that are sold usually all year round. The product sells at $100 per box. The following cost data has been prepared for its estimated upper and lower limits of activity for the year ended December 31, 2020. Lower Limit Upper Limit Production (# of boxes) 4,000 6,000Production Costs:Direct Materials …………$60,000 $90,000Direct Labour …................. $80,000 $120,000Overhead:Indirect Materials…………... $25,000 $ 37,500Indirect Labour ……………. $40,000 $50,000Depreciation ………………. $20,000 $20,000Selling & Administrative Expenses:Sales Salaries ……………………$50,000 $65,000Office Salaries …………………$30,000 $30,000Advertising …………………… $ 45,000 $45,000Other ………………………………$415,000 $20,000Total…
For February the cost components of a picture frame include $0.39 for the glass, $0.60 for the wooden frame, and $0.83 for assembly. The assembly desk and tools cost $650. Two hundred fifty frames are expected to be produced in the coming ver What cost function best represents these costs? OA y-0.99 650X OB ya 650+ 1.82X Oc ye182 +650X OD y 650 + 0.99X O Time Remaining: 01:58:02 Next ) 7. 8 R. 5 %23
17. Sergian, Inc. makes two products, Aothing and Cosmetics, from a joint operating process. For the month of August 2019, the total joint costs of processing was P120,000 and the costs of further processing after the point of split-off, as well as other relevant data are shown below: Clothing 1,600 Cosmetics Units after split-off Sales price per unit Further processing costs 800 P200 P400 P100,000 P140,000 The company uses the net realizable value method for allocating the joint costs of processing. For the month of August 2019, the joint cost allocated to product Clothing was: a. P60,000 с. Р72,000 ь Р6,000 d. P80,000
KPR manufactures is planning to introduce energy flavored milk from 1 July 2019. In this respect, following projections have been made: C-PLUS Planned production (No. of packets) 42,000 Sales (No. of packets) 42,000 Production cost per packet: (Rupees) Direct material 100 Direct labor 15 Variable overheads 23 Fixed overheads 1,500,000 Selling and distribution cost per packet: Variable overheads 12 Fixed overheads 500,000 current profit 100,000 Required Compute break-even sales and margin of safety in units (budgeted units 41,000)Calculate the number of units to be sold to maintain the current profit if the sales price remains at Rs. 100 and the variable overhead is Rs 33.
Need assistance with all workings please. Buggs-Off Corporation produces and sells a line of mosquito repellants that are sold usually all year round.The product sells at $100 per box. The following cost data has been prepared for its estimated upper and lowerlimits of activity for the year ended December 31, 2020. Lower Limit Upper LimitProduction (# of boxes) 4,000 6,000Production Costs:Direct Materials ........................ $60,000 $90,000Direct Labour ............................ 80,000 120,000Overhead:Indirect Materials............... 25,000 37,500Indirect Labour ................ 40,000 50,000Depreciation ................... 20,000 20,000 Selling &…
Birdfeeders Unlimited makes backyard birdfeeders. The company sells the birdfeeders to home improvement stores. $15 Sales price per birdfeeder 1.5 Board feet of wood required for each birdfeeder $4 Cost per board foot (actual) 10% Desired ending wood inventory stated as a percentage of next month’s production requirements 20% Desired ending finished goods inventory (finished birdfeeders) stated as a percentage of next month’s sales $550,000 Total cost of direct materials purchases in December 45% of direct materials purchases are paid in the month of purchase 55% of direct materials purchases are paid in the month after purchase Prepare the production budget for the first three months of the year, as well as a summary budget for the quarter
Birdfeeders Unlimited makes backyard birdfeeders. The company sells the birdfeeders to home improvement stores. $15 Sales price per birdfeeder 1.5 Board feet of wood required for each birdfeeder $4 Cost per board foot (actual) 10% Desired ending wood inventory stated as a percentage of next month’s production requirements 20% Desired ending finished goods inventory (finished birdfeeders) stated as a percentage of next month’s sales $550,000 Total cost of direct materials purchases in December 45% of direct materials purchases are paid in the month of purchase 55% of direct materials purchases are paid in the month after purchase Prepare the direct materials purchases budget for the first three months of the year, as well as a summary budget for the quarter. Assume the company needs 120,000 board feet of wood for production in April.
! Required information The following information applies to the questions displayed below] Shadee Corporation expects to sell 540 sun shades in May and 310 in June. Each shade sells for $156. Shadee's beginning and ending finished goods inventories for May are 65 and 55 shades, respectively. Ending finished goods inventory for June will be 50 shades. Each shade requires a total of $65.00 in direct materials that includes 4 adjustable poles that cost $5.00 each. Shadee expects to have 130 in direct materials inventory on May 1, 90 poles in inventory on May 31, and 100 poles in inventory on June 30. Required: Prepare Shadee's May and June purchases budget for the adjustable poles. Budgeted Cost of Poles Purchased May June

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