Robinson Chemical Company’s production process for two of its solvents can be diagrammed as follows:

The cost of the joint input, including processing costs before the split-off point, is $300,000. Solvent A can be sold at split-off for $30 per litre and solvent B for $45 per litre.

1. Allocate the $300,000 joint cost to solvents A and B by the physical units method.

2. Allocate the $300,000 joint cost to solvents A and B by the relative-sales-value method.

Transcribed Image Text:

Solvent A = 9,000 litres Joint input = 15,000 litres Split-off point Solvent B = 6,000 litres %3D