Reference no: EM131884810

Problem

Joint products A and B emerge from common processing that costs $20,000 and yields 1,000 units of Product A and 3,000 units of Product B. Product A can be sold as-is for $120 per unit or processed further and sold later for $175 per unit. Product B can be sold as-is for $120 per unit or processed further and sold later for $190 per unit. The additional per unit processing costs for Product A and B total $50 and $25, respectively. Assuming joint costs are allocated on the basis of units produced, how much joint cost will be allocated to Product A for inventory valuation purposes?