The following questions relate to Kyle Company, which manufactures products KA,

Question

The following questions relate to Kyle Company, which manufactures products KA, KB, and KC from a joint process. Joint product costs were $199,000. Additional information follows: If Processed Further Product Units Produced Sales Value at Split-Off Sales Values Additional Costs KA 85,000 $ 248,000 $ 360,000 $ 47,000 KB 59,500 217,000 250,000 41,000 KC 25,500 155,000 250,000 31,000 Required: a. Assuming that joint product costs are allocated using the physical quantities (units produced) method, what was the total cost of product KA (including $47,000 if processed further)? (Do not round your intermediate calculations.) b. Assuming that joint product costs are allocated using the sales value at split-off (net realizable value method), what was the total cost of product KB (including the $41,000 if processed further)? (Do not round your intermediate calculations.)

Explanation / Answer

Req a: Joint cost : $ 199000 Product Units % of Allocating JC Joint cost Allocation of JC KA 85000 50.00% 199000 99500 Kb 59500 35.00% 199000 69650 KC 25500 15.00% 199000 29850 Total 170000 100.00% 199000 199000 Total cost of KA: Share of JC 99500 Add: Further procesing cost 47000 Total cost of KA: 146500 Req b: Product Sales value Further cost NRV % of Allocating JC Joint cost Allocation of JC KA 360000 47000 313000 42.24% 199000 84058.03 Kb 250000 41000 209000 28.21% 199000 56128.21 KC 250000 31000 219000 29.55% 199000 58813.77 TOTAL 741000 100.00% 199000 199000 Total cost of KB Share of JC 56128 Add: Further procesing cost 41000 Total cost of KA: 97128

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