Sold at the split-off point basics

Assignment Help Accounting Basics
Reference no: EM13146478

Thorpe Industries produces chemicals for the swimming pool industry. In one joint process 10,000 gallons of GSX are processed into 7,000 gallons of xenolite and 3,000 gallons of banolide. The cost of the joint process, including the GSX, is $17,500. The firm allocates $11,800 of the joint cost to the xenolite and $5,700 of the cost to banolide. The 3,000 gallons of banolide can be sold at the split-off point for $3,500, or be processed further into a product called Kitrocide. The sales value of kitrocide is $11,000, and the additional processing cost is $7,900.

Required:

Thorpe's president has asked your consulting firm to make a recommendation as to whether the banolide should be sold at the split-off point or processed further. Explain your answer.

Reference no: EM13146478

Questions Cloud

Estimate true weight with an error normality distribution : Estimate the true weight with an error of 0.03 grams with 99 percent confidence? How to construct a 95 percent confidence interval for the population proportion of positive drug tests. How to tell if the normality distribution?
The mixture of gases in the venusian atmosphere : The Venusian atmosphere consists of 95% CO2 and 5% N2. Determine the apparent molecular weight for the mixture of gases in the Venusian atmosphere? Find the specific gas constant for the atmopshere of Venus?
What is the optimal solution : What is the optimal solution? What are the values and interpretations of the slack variables? D. What are the binding constraints?
Cost of production is fixed in the short run : For many corporations, a major portion of the cost of production is fixed in the short run. Should these very large fixed costs be ignored when the executives are making output and pricing decisions?
Sold at the split-off point basics : Thorpe's president has asked your consulting firm to make a recommendation as to whether the banolide should be sold at the split-off point or processed further. Explain your answer.
What happens when a strong acid and weak base are mixed : does the HCl ionize the NH3 base? is the a conjugate acid or base, HCl is a strong acid, what happens when a strong acid and weak base are mixed?
What is the molarity of 2500. ml of a solution : What is the molarity of 2500. mL of a solution that contains 160. grams of NH4NO3?
What is the molarity of the solution formed : what is the molarity of the solution formed by mixing 0.20 mol of sodium hydroxide with enough water to make 150 ml of solution
Calculating cost of equity : Calculating Cost of Equity The Dybvig Corporation's common stock has a beta of .85. If the risk-free rate is 5.2 percent and the expected return on the market is 12 percent, what is Dybvig's cost of equity capital?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Foreign currency transaction

A foreign currency transaction gain will be recognized by a U.S. company when it has a receivable from a foreign company

  How much may the employer deduct for these expenses

Carl, an employee of a Miami CPA firm, was sent to work in Tampa for eight months on March 1, year 1, on a financial audit. His monthly transportation expenses were $400, his monthly lodging was $1,200, and his meals were $800 per month.

  Problem regarding payment and invoice

Merchandise is sold for $3,600, terms FOB destination, 2/10, n/30, with prepaid freight costs of $150. If $500 of the merchandise is returned prior to payment and the invoice is paid within the discount period, the amount of the sales discount is ..

  Shares of warner company stock

During each of the next two years, warner declared and paid cash dividends of $0.85 per share, and its net income was $72,000 and $67,000 for 2007 and 2008, respectively. The January 12, 2009, entry to record the sale of 3,000 shares of warner com..

  How much to the temporarily restricted assets

On December 31, 2013, the child crisis center establishes an endowment fund with a $5 million gift of securities. Income from the endowment is to be used exclsuively to support a nutrition program.

  Margin of safety expressed in dollars

A company with a break-even point at $900,000 in sales revenue and had fixed costs of $225,000. When actual sales were $1,000,000 variable costs were $750,000. Determine (a) the margin of safety expressed in dollars, (b) the margin of safety expre..

  Firms expected rate of return

Taggart Inc.'s stock has a 25% chance of producing a 30% return, a 50% chance of producing a 12% return, and a 25% chance of producing a -18% return. What is the firm's expected rate of return?

  Variable costing-absorption costing

You are the vice president of operations for a small manufacturing company that uses the absorptive method of accounting for fixed manufacturing overhead, and you are approaching the end of the year.

  Conclusion about fairness of recorded balance

What is your conclusion about the fairness of the recorded balance in accounts payable for pinnacle manufacturing as it affects the income statement and balance sheet?

  Compute the break-even point

In August, Gold Company sold 770 units of their only product. For the month, fixed costs were $10,400, variable costs were 57% of sales, and the average sales price was $62.

  Steps in accounting cycle for merchandising company

Determine whether or not the measurement of net income for a merchandising company conceptually is the same for a service company.

  Discuss how statement of cash flows is used by investors

Discuss how the statement of cash flows is used by investors. If you were an investor reviewing a statement of cash flows, what section would interest you most? Why?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd