What is the ending inventory cost and gross margin for src

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Reference no: EM132853787

Seattle Recycling Company

The Seattle Recycling Company (SRC) can produce 25 table covers, 75 chair covers and 5 pounds of package filler from 100 pounds of plastic bottles.

In June, SRC had no beginning inventory. It purchased and processed 120,000 lbs of bottles at a cost of $600,000. After further processing, SRC sold 25,000 table covers for $12.50 each, 80,000 chair covers for $9.00 each and 5,000 pounds of package filler for $1.25 per lb.

units	Separable Cost	Processed value per unit
30,000	$ 15,000	$ 12.50
90,000	$ 90,000	$ 9.00
6,000	$ 1,500	$ 1.25

1) Use the NRV method to allocate joint costs

2) Prepare an income statement.

What is the ending inventory cost and gross margin for SRC? (Hint: For ending inventory, calculate the cost per unit)

Reference no: EM132853787

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