1. allocate the 400000 joint cost to solvents a and b by, Ask an Expert

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Hernandez Chemical Company's production process for two of its solvents can be diagrammed using a process map as shown in Exhibit 12-25.

The cost of the joint input, including processing costs before the split-off point, is $400,000. Solvent A can be sold at the split-off point for $20 per gallon and solvent B for $60 per gallon.

1. Allocate the $400,000 joint cost to solvents A and B by the physical-units method.

2. Allocate the $400,000 joint cost to solvents A and B by the relative-sales-value method.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M978422

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