A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs $12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows:

Required:
1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method.
2. What if it cost $2 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products?

Transcribed Image Text:

Further ProcessingEventual Market Product Gallons L-Ten Triol Pioze 3,500 4,000 2,500 Cost per Gallon S0.50 1.00 1.50 Price per Gallon S2.00 5.00 6.00