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Question - Crackle and Crunch Co. processes peanuts into three products. During March, the joint costs of processing were $240,000. Production and sales value information for the month were as follows:
Product
Units Produced
Split off Sales Value
Separable Costs
Salted peanuts
15,000
$100,000
$32,000
Raw peanuts
11,000
$85,000
$70,000
Peanut butter
6,000
$58,000
$38,000
Required -
1. Determine the amount of joint cost allocated to each product if the physical measure method is used.
2. Determine the amount of joint cost allocated to each product if the net realizable value method is used.
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