5:11 PM @ 14% L l etisalat 4G udmoodle.ud.ac.ae 6 of 8 Question 4. (10 Marks) Bo

Question

5:11 PM @ 14% L l etisalat 4G udmoodle.ud.ac.ae 6 of 8 Question 4. (10 Marks) Book problem 16-22 Fancy foods produces two types of microwaveable products: beef favored ramen and shrimp favored ramen. The two products share common inputs, noodles and spices. The production of ramen results in a waste of product referred to as stock which Fancy Foods dumps at a small cost to a local drainage area. In June 2017 the following data were reported for the production and sales of beef flavored ramen and shrimp chicken flavored ramen Joint costs $400,000 Joint costs of noodles, spices and other inputs and processing at Ramen Ramen in tons 20,000 tons 20,000 tons 28,000 tons 28,000 tons Sales ton 20 Based on the popularity of the microwavable products Fancy decides to add a new line of products that targets dieters. These new products are produced by adding a new ingredient to dilute the original ramen and are to be sold under the name of Special B and special S respectively. Following are the monthly data for all products Joint costs $400,000 Special B Special S oint costs of noodles, spices and other inputs and processing at split-off point Separable costs for producing 20,000 of Beef ramen and 25,000 tons of Special B $100,000 Separable costs for producing 28,000 of Shrimp ramen and 34,000 tons of $238,000 B Special Ramen n tons Production 000 28,000 20,00028,000 25,000 5,000 34,000 4,000 $5 Required: Calculate Fancy's Joint costs using the Sales Value at spinoff method (5 Marks) and the physical measure method (5 Marks)

Explanation / Answer

Beef Ramen Shrimp Ramen Total Sales Quantity       20,000.00            28,000.00      48,000.00 Price                  5.00                    20.00 Sales Value 1,00,000.00        5,60,000.00 6,60,000.00 Ratio-Sales Value               15.15                    84.85 Ratio-Sales Quantity               41.67                    58.33 Joint Cost 4,00,000.00 Split - Sales value at Spin off - Ratio to be used (Sales Value)               15.15                    84.85 -Joint Cost Split            60,606             3,39,394 Split - Physical Measure - Ratio to be used (Sales Value)               41.67                    58.33 -Joint Cost Split         1,66,667             2,33,333

Related Questions

Navigate

• Browse (All)
• Browse 5
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.