Method to account for the by producy

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Reference no: EM13149833

Colson Corp produces fillet, smoked and canned salmon in a single process. The same amount of disposal costs is incurred whether a product is sold at split off or after future processing. In Oct 2008, the joint cost of the production process is $71,000.
PRoduct Lbs Produced Sep Cost Final Sell pr

Fillets 9000 1.5 8.00
Smoked 10000 2.60 6.50
Remnants 1000 .15 .75

a. The remnants are considered a by product of the process and sold to make cat food. Allocate the joint cost based on approx NRV at split off. use the NRV method to account for the by producy.

b. Determine the value of ending finished good inventory, assuming 8000 lbs of salmon fillets, 9400 pbs of smoked salmon, and 950 lbs of remnants sold. Round cost per lb to nearest penny.

Reference no: EM13149833

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