Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total jo

Question

Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total joint costs are $390,000. The sales value at split-off was $430,000 for 4,800 units of product XX-1 and $170,000 for 1,800 units of product XX-2.

Assuming that total joint costs are allocated using the net realizable value at split-off approach, what amount of the joint costs was allocated to product XX-1?

Alpha Company manufactures products XX-1 and XX-2 from a joint process. Total joint costs are $390,000. The sales value at split-off was $430,000 for 4,800 units of product XX-1 and $170,000 for 1,800 units of product XX-2.

Explanation / Answer

amount of the joint costs was allocated to product XX-1= Total joint costs are $390,000/430,000+170,000*430,000=$279,500.

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